In many housing markets, home price growth is slowing down, supply is steadily increasing, and price reductions have hit their highest point since 2014.
A new Trulia study tracks these three trends together in an effort to gauge the market's shift in homebuyer favor. Price reductions surged in July and August of 2018, with a 17.2 percent increase in August alone. Annually, the share of home listings with price decreases rose in 63 out of the 100 largest U.S. metro markets. Listing price deductions are most common in the priciest markets, and the affordable entry-level of the market has fewer, and supply remains scarce. Year-over-year in August, the median price reduction was 2.6 percent.
The growing prevalence of price reductions is likely to be welcomed by home shoppers, but the news could be tempered somewhat by the fact the median price reduction itself is getting smaller. For the 12 months ending August 2018, the median listing price reduction nationwide knocked 2.6 percent off the listing price. This has been declining steadily from the same 12-month period ending in 2012, when the median U.S. price reduction was 4 percent. The median percent decrease of a price reduction today is less than the median price reduction at the outset of the recovery in 97 of the 100 largest metros analyzed.