Price Markdowns Increase on Homes for Sale

December 12 2010 (Jeff Alan)
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According to figures released by ZipRealty, price reductions on homes listed for sale increased dramatically over the past year with nearly half the homes marked down at least once. September also saw more discounted homes for sale than August, with the number of price-reduced homes on the market up 2.1 according to the report.

The company reports that 48.1 percent of all homes for sale, based on its Price Reduction Index of MLS-listed properties in 26 major markets, have seen at least one price markdown. The most dramatic marked down listings were experienced in San Diego, San Francisco, and Orange County where the rate of marked down listings has essentially doubled over the preceding 12 months.

The median markdown on San Francisco homes for sale was $35,050, leading the entire survey, followed by Orange County at $32,450 and San Diego at an even $30,000.

The number of marked-down homes for sale in San Diego was up 108 percent compared to November 2009, while San Francisco saw a 100 percent increase. Price-reduced properties were up 91 percent in Orange County and 79 percent in Los Angeles. The only other market were price-reduced inventory increased by more than 75 percent was Las Vegas, Nev.

Jacksonville, Fla., continues to have the highest percentage of price-reduced homes out of the 26 markets surveyed. More than 55 percent of Jacksonville listings in September included at least one price reduction, while Denver had the lowest percentage of price-reduced homes in September, with 34.4 percent of listings including at least one reduction.

John Oldham, Director of Marketing for ZipRealty said, “Typically, November is a slower month for sales. Inventory peaked in September and has dropped over the last two months. The increase in price-reduced listings is evidence that sellers are still trying to find the right price point to get the property to sell.

Nearly two-thirds of the 26 markets surveyed showed an average of two markdowns per listing with a median reduction of $19,165. In 11 of the 26, more than half of all listings had experienced at least one markdown.

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