A large share of home sellers in pandemic boomtowns dropped their asking prices in July as buyers regained more control over a cooling housing market. Roughly 70% of homes in Boise, ID experienced price drops in July, followed by 58% of listings in Denver, CO and 56.4% in Salt Lake City, UT.
After attracting thousands of out-of-state buyers throughout the pandemic, the nation’s hottest housing markets are rapidly cooling, and sellers are beginning to align their expectations with a slowdown in buyer activity, especially as rising mortgage rates push homeownership out of reach for a growing number of house hunters.
Nationwide, the share of homes for sale with price drops reached a record high in July. Sellers had to cut their prices because they were catching up with buyers, who had come to expect lower prices amid a cooling market. Rising mortgage rates and the prospect of falling home values also made buyers hesitant to pay sky-high prices, and an uptick in supply gave them more to choose from. Price drops are likely to flatten out as sellers come to terms with the shifting market.
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