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Price Reductions Unchanged as Sellers Start the Summer With Optimism

Unchanged from last month, 22 percent of listings on the market as of June 1, 2010 experienced at least one[IMAGE]

price reduction, San Francisco-based ""Trulia"":http://www.trulia.com/ recently reported. And price reductions dipped slightly from the same period last year when 23.6 percent of listings experienced price cuts.

According to Trulia, the total dollar amount slashed from home prices was $26.7 billion, and the average discount for price-reduced home continued to hold steady at 10 percent off of the original listing price.

""Sellers are optimistic heading into the summer season because of the strong sales figures from the spring,"" said Pete Flint, co-founder and CEO of Trulia. ""The spring sales were fueled by the expiration of the tax credit and my


concern is that this heavy activity is providing sellers with a false state of optimism.

Flint said Trulia is already starting to see rising inventory levels, and he believes this will be the story of the summer. Going forward, Flint said buyers will continue to have the negotiating power, and he expects sellers will get aggressive via price cuts throughout the summer.

Compared with year-ago levels, Trulia said cities in the Western U.S. experienced the largest decreases in price reductions. Las Vegas led the way with a 67 percent drop in price cuts, and six California cities â€" Oakland, San Jose, Los Angeles, Sacramento, San Francisco, and San Diego â€" saw price reductions fall 24 percent or more.

On the other end of the spectrum, cities in the Midwest and South experienced the most notable increases in price reductions in the year-over-year comparison. Price cuts in Kansas City, Missouri surged 55 percent from June 2009 to June 2010, while other cities such as Arlington, Texas; Cleveland; Louisville, Kentucky; and Houston all saw price reductions jump 30 percent or more.

And for the second month in a row, Minneapolis had the most listings with price reductions, as 40 percent of for-sale properties were reduced in price. Trulia said no other city has reached this mark since it started tracking home price reductions in April 2009. With an average discount for price-reduced homes at 8 percent, the city's total dollar amount slashed from home prices was $26.4 million.

About Author: Brittany Dunn


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