The local birdcage liner has an article on price reductions, and mentions that San Diego leads the nation this year. This is how they introduced it:
This isn’t a sign that the bottom is falling out of the market. Instead, after years of rapid price increases, experts say the market is becoming more stable and for the first time in quite a long time, it is shifting in favor of buyers.
That shift is most evident when you look at the number of times sellers have reduced prices. The share of home listings with a price cut grew to its highest level in at least eight years, says a recent analysis from Trulia. San Diego had the most reductions — 20.5 percent — of the 100 biggest metro areas in the United States so far this year. (It tied with Tampa, which also saw 20.5 percent of homes with a price cut.)
The full article (linked here) included examples:
- 7171 Terra Cotta Road — $545,000. The four-bedroom house (1,804 square feet) in the Bay Terraces area has had four price reductions, starting at $569,000 at the beginning of November.
- 4225 Florida St., Unit 4 — $395,000. The two-bedroom condo (794 square feet) in University Heights has had three price reductions, starting at $425,000 in mid-October.
- 3655 Ash St., Unit 2 — $322,100. The two-bedroom condo (824 square feet) in Fairmount Park has had six price reductions, starting at $330,000 in mid-September.
Listing agent April Khamphasouk said the tough thing about selling the house at 2873 Upas St. is that it is basically two homes in one (the property is 1,698-square-feet and has a guest suite above the garage).
She first listed the home for $1.1 million in early October. By mid-October, the price was lowered by $19,000. There were three more price reductions and by Nov.12, the asking price for the home had decreased by $55,900. It is still on the market.
Khamphasouk said the recent price reduction seemed to be greatly increasing interest. Still, she said a lot of the issues in the past month have been related to rising mortgage interest rates.
No mention was made about the Upas property selling for $775,000 in May. The Terra Cotta house just had a model-match sell for $415,000 nearby, and the Florida St. condo is on the corner of El Cajon Blvd. and next to a paint store. If these homes represent the types of properties that need to lower their price, then the shock is that only 20% needed a price reduction.
The real news was that nearly 80% of the listings didn’t lower their price!
$545,000. four price reductions, starting at $569,000
That’s at most one reduction and to my mind barely half of a price reduction.
I corrected a slight typo in the comment above – that’s why my face is shown.
The local association posted this article on FB and I made a snarky comment…..so they deleted the whole thing:
Here is what I was going to say before they deleted it.
I think if you are the trade group publishing it publicly, you should help the readers out with some interpretation or explanation, rather than leave it them to figure it out.
Because a potential buyer who reads it will say, “Hey, I better wait and see what happens”.
If our own trade group is unwilling to interpret information, then don’t post anything. You are here to help us, not hurt us.
What could be said about the article to help readers?
By August the slowdown had already begun, yet almost 3/4 of the listings didn’t have to change their price? Sounds fairly healthy to me.
We’ll check it again tomorrow when the Case-Shiller Index comes out, but in each of the last three years our local pricing was rising steady for the first half of the year, then flat-lined for the remainder. August would be the month that sellers would have to adjust to sell.
Additionally, counting the number of reductions doesn’t tell you much. Listing agents regularly lower the price a couple of bucks to get on the hotsheet again. A real analysis would study the dollar amount of the price reductions, because as Rob Dawg stated above, seeing a price reduced by 4% total in four different moves isn’t a reason to panic.
My gods I’m handsome! 😉
Yes to all your observations.
To be tedious; if only someone had seen this coming.