WHAT DOES THE REASON RASH OF PRICE REDUCTIONS MEAN TO THE REAL ESTATE MARKET

What Does the Recent Rash of Price Reductions Mean to the Real Estate Market?

Last week, in a new report from Zillow, it was revealed that there has been a rash  of price  reductions across the country. According to the report: There are more price cuts now than a year ago in over two-thirds of the  nation’s largest metros  About 14% of all listings had a price cut in June  Since the beginning of the year, the share of listings with a price cut  increased 1.2%  This is the greatest January-to-June increase ever reported, and more than  double the January-to-June increase last year  Senior Economist Aaron Terrazas further explained: “A rising share of on-market listings are seeing price cuts, though these price cuts are concentrated at the most expensive price-points and primarily in markets that have seen outsized price gains in recent years.” What this DOESN’T MEAN for the real estate market… This doesn’t mean home values have depreciated or are about to depreciate. A seller may put a home worth $300,000 on the market for $325,000 hoping a bidding war will occur and an overanxious buyer will pay more than its actual value. That has happened often over the last few years. If the seller gets no offers and reduces the  price to $300,000, it doesn’t mean the home dropped in value. It is still worth $300,000. Home prices will continue to appreciate over the next 12 months. In this same  report, Terrazas remarks: “It’s far too soon to call this a buyer’s market, home values are still expected to appreciate at double their historic rate over the next 12 months, but the frenetic pace of the housing market over the past few years is starting to return toward  a more normal trend.” What this DOES MEAN for the real estate market… This does mean that sellers should be more conservative when it comes to the  price at which they list their homes – especially sellers in the upper end of each market. Sellers have been listing their homes at inflated prices hoping a super-hot market will deliver a buyer willing to pay virtually any price to ensure they don’t lose the house. That strategy has worked somewhat successfully over the last two  years. However, the time that strategy would have worked may have passed. Again, quoting Aaron Terrazas in the report: “The housing market has tilted sharply in favor of sellers over the past two years, but there are very early preliminary signs that the winds may be starting to shift ever-so-slightly.” Bottom Line Prices are not depreciating. However, if you want to sell your house quickly and with the least amount of hassles, pricing it correctly from the beginning makes the most sense. Holly Hurd ~ Berkshire Hathaway HomeServices HWWB, REALTORS.......your source for all your real estate. We are one of the Largest brokerage firms in Michigan, we have proven we can stand the test of time in this ever changing market place a proven leader for you and all your real estate needs. In today's competitive real estate market, timing is everything. Many good homes are sold before they are ever advertised. Beat other homebuyers to the hottest new homes for sale in the Wayne/Oakland co. area with my New Listings Notification. If you own real estate that you're thinking of selling, I would be happy to provide you with a FREE Home Evaluation. Whether you are buying or selling a home, hire someone like me, who wants to earn your business. I invite you to contact me as I'd be happy to assist you with this important transaction. In addition, if you have any general questions about buying or selling real estate in Michigan, please contact me as I'm more than willing to help.YOU CAN REACH ME DIRECT BY PHONE ANYTIME AT 734 718-5736 #YourHomeNorthvilleMichigan Real Estate Homes for sale in Northville Michigan Northville, Mi. 48167 #realtor #realestate #realestatemarket#realestateforsalemi #hometown #hollyhurd #home#homesforsale #historicnorthville #buy #buyingahome#buildingahome #buyrealestate #condo #northvillemi#sellyourhome #sellingyourhome #smalltown #shop #bhhs#berkshirehathaway #moveinmichigan #greattimetobuy#puremichigan #SOLD