Home sellers in the 50 most populated cities nationwide cut their listing prices by an average of 10 percent in September, unchanged from August, according to Trulia’s study of homes on Multiple Listing Services and on brokers’ listings. The study doesn’t include foreclosure listings.
Among the 50 major cities studied, the biggest price reductions occurred in Detroit, where home prices were cut by 25 percent; Phoenix, where prices were slashed by 14 percent; and Las Vegas and Cleveland, where sellers reduced their asking prices by 13 percent. Considering all the 50 cities, the average price reduction was $33,892.
Of the total home listings in the 50 cities, 26 percent experienced price reductions, equivalent to a total amount of $29.02 billion. Minneapolis had the biggest percentage of listings with prices reduced, as 43 percent of home sellers cut their prices. Milwaukee followed with 40 percent. Phoenix, Mesa and Albuquerque rounded out the top five with 39 percent, 37 percent and 35 percent of price reductions, respectively.
In California, the number of home listings with price reductions increased in seven of its largest cities, but the percentages were still in line with national data. Long Beach had 28 percent of its listings reduced while Fresno and Sacramento had 26 percent. San Francisco and San Diego respectively had 24 percent and 23 percent of their listings reduced in prices.
In Florida, only two cities were included in the study — Jacksonville and Miami. Jacksonville had 34 percent of its home sellers reducing their asking prices while Miami posted a far lower percentage of 18 percent, second to the lowest in the study. Detroit, surprisingly, had the lowest share of listings with price reductions, given that its bargain home prices were news items months ago.
Another study, carried out by ZipRealty on 26 major markets nationwide, found that 47.8 percent of home sellers cut their listing prices in September, a figure that cannot be compared directly with the 26-percent share determined by Trulia as this firm studied 50 cities.
The cities with the biggest percentages of listings with price reductions were Jacksonville, with 55.8 percent; Phoenix, 55.4 percent; Minneapolis-Saint Paul, 53.2 percent; and Orlando, 52.8 percent.
At the opposite end, the cities with the lowest percentage of home sellers cutting their asking prices were Denver, with 34.4 percent; Los Angeles, with 39.1 percent; Richmond, with 42.9 percent; Miami-Palm Beach-Fort Lauderdale, with 43.3 percent and San Francisco, with 45.2 percent.
ZipRealty reported that on average, home sellers cut their asking prices twice in September. The median price reduction was $19,165 and the median listing price was $245,265, lower by 15.3 percent than the September 2009 median and lower by 1.8 percent than the previous month’s price median.
Both studies pointed to the impact of the tax credit expiration as among the top factors for the price reductions. Analysts said that home sellers needed to attract buyers into the sluggish market by giving substantial price discounts.