Redfin: Gap Between Asking Price, What Buyers Willing to Pay Creeps Higher

(Image courtesy of Redfin)

Redfin, Seattle, released a report finding that the prices home sellers are asking for and the prices that homebuyers are paying diverge by $39,000–the largest gap since May 2020.

The typical home for sale is listed for 9% more than the typical home is selling for.

Redfin’s finding is based on home listing and sale price data in March, when the typical newly-listed home had a price tag of $469,729, a record high. However, the typical home that sold last month garnered $431,057.

List prices are growing more than twice as fast as sale prices, the report noted. The last time something similar happened was July 2020, during the pandemic homebuying frenzy. Currently, sellers are pricing high based on comps from the past rather than current demand. Those include sellers who bought during the price spikes of 2021 and 2022 and are trying to recoup their investments.

But, in some areas sales prices are actually down from a year earlier, including metros in Florida, Texas and the Bay Area.

“Homebuyers today have the upper hand because they’re outnumbered by sellers, and that’s a tough pill for sellers to swallow,” said Redfin Senior Economist Elijah de la Campa. “When buyers and sellers are on different planets, one side eventually has to give in, and it’s looking like it’s going to be sellers this time. Rising inventory, price drops and seller concessions indicate this is already starting to happen, and sale-price growth will likely continue to slow as a result.”