In February, more American homes experienced a price drop than any other winter in recent history, according to new data from Redfin.
“More than any time in the past few years, 2019 is shaping up to be a good year for homebuyers,” Redfin writes. “One way the market has shifted to buyers: More price drops. As of mid-February, more than one in five homes for sale had a price drop—the largest February rate in at least 10 years.”
Notably, Redfin highlights that on average, two-in-five homes in Fresno, California experienced a price drop. This means in February alone, 40.4% of homes in Fresno’s housing market dropped their price.
“Price drops are a highly cyclical measure, typically peaking late in the year and falling dramatically to start each new year, and this year is no different,” Redfin writes. “However, even though the share of homes with price drops is down quite a bit from the fall and isn’t up year-over-year as much as it was then either, it is starting 2019 at a much higher level than the past several years.”
Redfin notes that price drops are climbing nationwide, rising frequently and larger in metros like Las Vegas, Seattle and Albuquerque. In these housing markets, home prices declined by 13.6 points, 12.8 points and 12.2 points, respectively.
“Many sellers listed their homes late last year just as rising prices and mortgage rateswere starting to price out their core pool of potential buyers,” Redfin Agent Jennifer Brockman said. “Meanwhile, some buyers are starting to think that waiting to purchase a home could pay off, especially as listing inventory continues to rise.
Interestingly, Brockman said in this new market reality, buyers may have negotiating power now that they won’t have in the spring and summer.
The latest data from RE/MAX shows that Americans are now seeing the largest year-over-year inventory increase within the least 10 years.
According to RE/MAX CEO Adam Contos this indicates the market is swinging in homebuyers favor.
“The winter chill extended to the housing market in January, as home sales remained cool,” Contos said. “The good news is that inventory levels in January continued to rise on a year-over-year basis, providing incremental improvement in what’s been a multi-year shortage of for-sale homes. This is a positive for homebuyers, as the market continues to swing their way.”