Housing & Mortgage
Not All Housing Markets Are on Fire: Where to Find Price Cuts
Chicago, Pittsburgh and New Orleans among softer markets
News coverage these days paints a picture of a real estate market overrun with eager buyers happy to pay tens of thousands of dollars over asking price to win the inevitable bidding war.
But in many markets, sellers still have to cut listing prices to attract buyers — just the kind of dynamic a buyer wants.
Yes, just 7% of listed homes nationally had a price cut as of April 2021, Zillow reports, down from 14% in April 2019. But in some big and attractive metro areas, the level is considerably higher as of April.
—New Orleans: about 12%
The median price cut on a home in New Orleans was nearly 3% of the original list price, or $9,700. According to Redfin, there are nearly 1,500 homes currently for sale in New Orleans, and it takes about 27 days for homes to sell after being put on the market. The sale price of a typical home is $340,000.
A bright, modern, 2,000-square foot, three-bedroom, two-bath home in New Orleans that includes a fenced private yard, open floor plan, high-end kitchen, and walk-in closets in the primary bedroom is for sale for $364,000, down from $369,000.
An updated, turnkey, 1,900-square-foot, four-bedroom, two-bathroom home in the desirable Black Pearl neighborhood is for sale for $425,000, down from $421,000. The home features 14-foot cathedral ceilings, a private back patio and granite counter tops.
—Chicago: about 12%
The median price cut for a home in Chicago was close to 3%, or $9,700. According to Redfin, there are about 10,000 homes currently for sale in Chicago, and it takes about 17 days for a home to sell. The sale price of a typical home is $357,000.
—Pittsburgh: about 11%
Pittsburgh was the only market in the 79 listed to actually see an increase, even if modest, in the percentage of listings with a price cut between April 2020 and April 2021.
The median price cut for a home in Pittsburgh was nearly 4%, or $8,700. According to Redfin, there are over 1,500 homes for sale in Pittsburgh right now, and it takes a home about 51 days to sell. The sale price of a typical home is $225,000.
—Baton Rouge: about 10%
The median price cut for a home in Baton Rouge was close to 3% or $6,600. According to Redfin, there are nearly 1,100 homes for sale in Baton Rouge right now, and it takes about 20 days for a home to sell. The sale price of a typical home is about $236,000.
Clearly, a seller who lowers the price is motivated, meaning they may be willing to accept an offer still lower, perhaps substantially if the property has been on the market for a long time. Your strategy should take into account sales of comparable homes nearby the seller’s situation. Don’t let relief at not being in a bidding war make you a chump who overpays.