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More home sellers drop their asking price because the housing market cools

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Daniel Acker | Bloomberg | Getty Images

Home sellers are getting nervous, because the once-hot housing market cools fast.

One in 5 sellers in August dropped their asking price, in response to Realtor.com. A yr ago that share was just 11%.

The common home sold for lower than its list price for the primary time in over 17 months in the course of the four-week period ended Aug. 28, in response to a report by Redfin.

Homes are simply not selling on the breakneck pace they were six months ago, when strong demand butted up against tight supply, bidding wars were the norm, and a seller could often get a signed contract in under a weekend. Homes in August sat available on the market a median five days longer than they did a yr ago — the primary annual increase in time available on the market in greater than two years.

The provision of homes on the market can also be rising fast, up nearly 27% from a yr ago, whilst fewer sellers determine to list. Pending sales in July, which represent signed contracts on existing homes and that are probably the most recent sales data available, were nearly 20% lower than July 2021, in response to the National Association of Realtors.

“For lots of today’s buyers, the uptick in for-sale home options is taking away the sense of urgency that they felt in the course of the past two years, when inventory was scarce,” said Danielle Hale, chief economist at Realtor.com. “Because of this of this shift, coupled with higher mortgage rates, competition continued to chill in August, with listing price trends indicating that home shoppers are tightening their purse strings.”

The median listing price in August dropped to $435,000 from $449,000 in July, in response to Realtor.com.

Mortgage rates have been rising since January, hitting a recent high in June after which falling back barely in July and far of August. They’re, nevertheless, rising again and are actually nearly matching that June high.

Redfin reported that requests for home tours and other homebuying services from its agents at the tip of August was down 16% from the identical period the yr before. Touring activity was also down 9% from the beginning of the yr, compared with an 11% increase at the identical time last yr, in response to home tour technology company ShowingTime.

“The post-Labor Day slowdown will likely be just a little more intense this yr than in previous years when the market was super tight,” said Daryl Fairweather, Redfin’s chief economist. “Expect homes to linger available on the market, which can lead to a different small uptick within the share of sellers lowering their prices.”

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