Sellers Slash Prices as Housing Market Stalls

Discounts and Delistings Hit New Highs

New national real-estate reports show the housing market entering a colder season — and not just because it’s December. Zillow finds that sellers are now discounting their homes at record levels, cutting prices by an average of $25,000 when listings don’t move. At the same time, Redfin reports homeowners are pulling properties from the market at the highest rate since 2017, often because buyers simply aren’t biting at current asking prices.

After years of steep appreciation, home values in many regions have now flattened or even declined. But while prices have cooled, that hasn’t translated into relief for buyers.

Affordability Improves… But Not Enough

Mortgage rates have dipped from the 7-percent-plus range seen in January, but economists say affordability remains a major barrier. “Even though conditions have improved a little bit… they’re still not affordable,” noted Nationwide economist Ben Ayers, pointing to rising concerns about job security and a cooling labor market.

Those factors have combined to create a climate where fewer shoppers feel confident enough to make one of the biggest purchases of their lives.

Weak Construction, Flat Job Market Add Pressure

Industry experts had hoped falling rates would stimulate demand earlier this year, but momentum never materialized. “We still have pretty much a lackluster housing market,” said Guy Cecala of Inside Mortgage Finance, citing lingering high mortgage rates and lean inventory.

Meanwhile, new-home construction — the lifeline for first-time buyers — continues to slip. Single-family housing starts are expected to fall 6% to 7% this year, according to the National Association of Home Builders.

Portland broker Israel Hill puts it simply: “The biggest indicator in the real estate market is job growth. And the job market is flat.”

For many would-be buyers, that’s enough to stay on the sidelines.