Only 28% of Homes Are Selling Above Asking Price...Lowest Springtime Level Since 2020
Pending home sales are down 1% year over year while new listings are still rising, giving buyers negotiating power.
Just over 28% of San Diego homes are selling above the asking price, down from 32% a year earlier. That’s the lowest level for this time of year since 2020, when the start of the pandemic ground the housing market to a halt.
That’s one signal of the shift toward a buyer’s market in much of the country. For the sake of comparison, more than half (53%) of homes sold above list price during this period in 2022, when the housing market was heavily favoring sellers. The share of homes selling above asking price has fallen year over year in all but five of the most populous U.S. metro areas; San Jose, CA, Anaheim, CA, and Oakland, CA saw the biggest declines, though more than half of homes are still selling above asking price in San Jose and Oakland.
Here are some other data points illustrating the tilt in buyers’ favor, and the slower-than-usual spring market (data is from the 4 weeks ending June 8):
- Pending U.S. home sales fell 1.1% year over year to their lowest level for this time of year in our records.
- Just over one-third (37.6%) of homes went under contract within two weeks, also the lowest level for this time of year since 2020.
- There has been a big gap between the median list price and the median sale price for the last several weeks. The median sale price was $397,000, a $28,950 discount (-7%) from the median list price of roughly $425,950. For comparison, the median sale price was typically much higher than the median list price when the market was favoring sellers in 2021 and 2022.
Prospective homebuyers are sidelined by widespread economic uncertainty and high housing costs. The median monthly housing payment is just $29 shy of its record high, with mortgage rates near 7% and sale prices up 1.6% year over year (though sale prices are lower than list prices).
“It’s still tough for many San Diegans to buy a home, as affordability remains a real challenge, but house hunters should know that sellers are accepting offers below asking price and giving concessions to get deals done,” said Hennin Foreman, The DHC Group team lead. “Buyers have negotiating power, especially if they’re flexible on timing or location, or if they’re willing to take on a fixer upper. Buyers should negotiate, and be prepared to move on to other homes if a seller is unwilling to meet them halfway; they may be able to get a better deal elsewhere.”
On the selling side, new listings are up 5.2% year over year. There are many more home sellers than buyers in the market. But it’s worth noting that mortgage-purchase applications are up 10% week over week, signaling that pending home sales could improve soon.
With the cost of homeownership so high in San Diego, making the right decision about buying or selling a home can feel like a real challenge. Whether you're downsizing, upsizing, investing or cashing out all together...if you’re open to having the right team put in the work for you, we can get it done.
Hennin Foreman and The DHC Group can help you explore what’s possible and present pain free options that might work for you.
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