Redfin Reports Price Drops Hit Highest Level in 18 Months as High Rates Dampen Buyer Demand

(Illustration courtesy of Redfin)

Nationwide, 6.4% of home sellers cut their asking price during the four weeks ending May 26, the highest share since November 2022, according to Redfin, Seattle.

“The market is slower than usual, but well-maintained properties listed for under a million dollars still get multiple offers,” said Christine Chang, a Redfin real estate agent in the Bay Area. “People who are buying right now are typically doing so because they’re having a baby or looking for a more family friendly home. My advice for those buyers is to be open-minded: Consider single-family homes that are a bit outdated but don’t need major renovations, and/or homes in lesser-known, non-trendy neighborhoods. That type of home tends to sit on the market longer, and buyers may be able to avoid competition and get a home for asking price instead of engaging in a bidding war.”

Chang suggested buyers who can get by with less space should consider a condominium. “They’re relatively unpopular right now and many are going under asking price,” she said.

Redfin reported the median asking price dropped roughly $3,000 in the last week to $416,623, the first decline in six months. Additionally, for-sale supply is growing more stale: Age of inventory (the typical number of days active listings have been on the market) started rising year-over-year in May for the first time in eight months, hitting a median of 46 days. Together, those metrics suggest sale-price growth could soften in the coming months as persistently high mortgage rates turn off homebuyers.

For now, the median-home sale price is up 4.3% year over year to another record high, though Redfin noted sale prices are a lagging indicator because they’re typically negotiated at least a month before a deal closes.