Global Knife and Tomato
 photo credit: jackenhack

March 9, 2010

Today Trulia announced a new all-time low for national home price reduction levels since the company started tracking in April 2009, with 19 percent of listings currently on the market in the United States as of March 1, 2010 experiencing at least one price cut. This represents a 10 percent decrease from the previous month and the first time price reduction levels have dropped below 20 percent. The total dollar amount slashed from home prices dropped to $21.6 billion and the average discount for price-reduced homes continues to hold at 11 percent off of the original listing price.

Many major metros* across the U.S. have seen steady declines in price reductions during the past few months. The following U.S. cities experienced the biggest decline in price reductions from February 1, 2010 to March 1, 2010:

trulia-home-price-reduction

Six major cities in California also occupy the lowest percent of current listings with price reductions out of the Top 50 national cities: San Francisco (16%), Sacramento (15%), San Diego (13%), Oakland (13%), San Jose (12%) and Fresno (12%).

“Consumer engagement on Trulia remains at an all time high, but home sales have dropped nationally during the past few months because there has been a lower sense of urgency to ‘buy now’,” said Pete Flint, Trulia co-founder and CEO. ”As we get closer to the government incentives running out, we expect price reductions to increase as sellers begin to feel the pressure to lure buyers in, in advance of the tax credit expiration.”

The Tax Credit Effect

Price reduction levels peaked nationally toward the end of 2009, corresponding to the timing of the original November 2009 deadline for the Federal Housing Tax Credit. In the months following the extension of the tax credit, price reduction levels have since declined. National price reduction levels by month:

  • March 2010 – 19%
  • February 2010 – 21%
  • January 2010 – 21%
  • December 2009 – 22%
  • November 2009 – 26%
  • October 2009 – 26%
  • September 2009 – 26%
  • August 2009 – 25%
  • July 2009 – 25%
  • June 2009 – 24%

Buyers and Sellers Disagreeing

While many states are seeing lower levels of price reductions, sellers and buyers in the following states continue to disagree more frequently on what is fair for home prices in their respective states:

Million-Dollar Markets Hit Hardest

The average amount slashed from homes listed at $1 million above is 14 percent off of the original listing price. The following five cities saw significantly bigger discounts on properties priced above $1 million compared to the national average for March 2010:

March 2010 Price Reductions – Top 50 U.S. Cities

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For more info on Trulia’s national home price reduction report, please visit our press release in the Trulia News Room.


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