More Sellers Drop Price as Market Cools

In No. 1 Boise, Idaho, 2 out of 3 sellers (61.5%) dropped their asking price in June. In No. 9 Tampa, a Redfin study found 44.5% of sellers lowered their price.

SEATTLE – Home sellers’ expectations often lag reality when the real estate market starts to slow down, and those over-exuberant expectations often show up in the number of sellers who lower the price of their listing.

According to a study of June home listings by Redfin, the number of sellers lowering their asking price spiked notably higher in June 2022 compared to June 2021. In the eight Florida metros included in Redfin’s study, the range ran from 44.5% of Tampa sellers down to 19.8% of Miami sellers.

June 2022 Florida home-sale price drops by percent of sellers

• Tampa: 44.5% (28.6% in June 2021)
• Cape Coral: 41.2% (21.5% in 2021)
• Jacksonville: 40.1% (15% in 2021)
• Lakeland: 36.8% (19.1% in 2021)
• Orlando: 34.7% (25.1% in 2021)
• West Palm Beach: 26.3% (11.4% in 2021)
• Fort Lauderdale: 20.9% (11.4% in 2021)
• Miami: 19.8% (9.7% in 2021)

Boise, Idaho, led the list for percentage of home price cuts, with nearly two-thirds (61.5%) of its listings “price reduced” – the highest share of the 97 metros in the analysis. Next came Denver (55.1%) and Salt Lake City (51.6%), followed by Tacoma, Washington (49.5%), Grand Rapids, Michigan (49.3%) and Sacramento (48.7%). Seattle (46.3%), Portland, (45.7%), Tampa, (44.5%) and Indianapolis (44.1%) rounded out the top 10 list.

Boise, Salt Lake City, Sacramento and Tampa were popular during the pandemic with homebuyers moving in from pricey coastal job centers, taking advantage of low mortgage rates and remote work. Their popularity led to heated competition for a limited supply of homes for sale, pushing up prices and making them unaffordable for many buyers.

“Home sellers are contending with a rapidly changing market, especially in places where they’re used to their neighbor’s homes getting multiple offers and selling for more than asking price,” says Redfin Senior Economist Sheharyar Bokhari. “Higher mortgage rates and a potential recession are causing prospective buyers in popular migration destinations to press the pause button, and they’re also having a big impact on workers in big job centers who rely on their stock portfolio for down payments.”

She says sellers are “adjusting their expectations in real time as they realize they may not get the price their neighbor got two months ago. … If demand plateaus in the coming months, price cuts are likely to be less common as sellers realize the market has shifted” and they’ll price their home more realistically from the start.

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