Price Reductions, on the Rise
By Jim Palmer Jr.

In a recent blog by a reputable broker a statement was made that, “It isn’t a seller’s market anymore, and sellers should get real!”  While it is certainly true that the current real estate market is very stagnant because of high interest rates, fears of political ramifications, and natural market corrections, I’m not sure that sellers should panic yet.  The reason I say that is because of the continued shortage of inventory.  Even though stats show total inventory is up by over 32%, all that means is that listings are lingering on the market much longer.  The number of new listings in the Spokane Realtor owned MLS is only about 2% higher than last year at the same time.
Could it be that starving brokers may be contributing to sellers panic because they are hungry for a paycheck?  Sales data indicates a drop in sales by over 12% compared to June of last year and brokers have already dropped out of the business in large numbers. 

From a listing broker’s perspective, average market times are increasing significantly and the phones are just not ringing.  There are over 290 prices reductions so far in July (trendy brokers call those “price improvements”) which may indicate that sellers are starting to panic.  The stats show the number of price reductions were 52 in May and 122 in June. 

Recently a very large price reduction (a couple hundred thousand) was made to a listing over one million.  A couple of weeks have passed without any calls from any buyers.  The question sellers and brokers need to ask is, will a price reduction really help or are there just no buyers pounding the pavement right now in this ghost-town market? 

Even with an ever increasing number of price reductions to active listings, the Median Price and Average Price of listings continue to trend upward.  There is definitely a dearth in the market, like it’s just taking a break, but it certainly would not be considered a crash like we’ve seen in the past where sold prices dropped significantly. 

Some buyers may be hesitating for now because they see listings that have languished on the market for long periods and they expect prices to drop significantly.  The statistics just don’t bear that out for that kind of thinking.  Sellers don’t panic, be patient!  The winds of change are on the horizon and it will likely be a positive change for sellers.