The rate of home sellers cutting the list price doubled in some metro areas. Plus: Rent assistance program in last phase, Colorado unemployment rate drops to 3.4% and more!
Putting your house up for sale is stressful enough. Now, sellers find themselves having to cut their listing price after the home is already on the market.
Two to three times more sellers in Denver, Fort Collins and Colorado Springs reconsidered their list prices and then lowered them in June compared to a year ago, according to new data from Zillow.
As What’s Working wraps up its special housing-focused series of reports, results are coming in on how much prices changed in June. Not the average price the house sold for, though. Those have barely budged. There’s also the latest job report that shows Colorado has recovered 110% of the jobs lost in the pandemic, which helped push down the state’s unemployment rate to 3.4% in June. More on that below.
But first, let’s talk about housing.
18% of Denver and Colorado Springs sellers cut sale price in June
Cutting the price of a house after it hits the market is normal. But it doesn’t come without adding stress for the seller.
The share of listings with a price cut in June for Denver was 18.3%, up 7% month over month, according to data from Zillow. So, if there were 4,807 houses available in Denver for active listing according to Federal Reserve Economic Data, 879 cut their prices.
In Colorado Springs, prices were cut on 18% of listings. In Fort Collins, they accounted for 9.5%, a threefold increase from June 2021.
“Sellers in Denver and Colorado Springs are getting anxious due to the sudden pullback in demand from buyers in those markets,” senior Zillow economist Jeff Tucker said in an email. “The Mountain West is transitioning quickly from a white-hot sellers’ market toward much more balanced conditions, and many sellers have been caught off guard by this sharp turnaround. Some sellers overshot the mark with their initial list price, but after last year’s big run-up in home values, they still have a lot of room to find a price point that will sell.”
But price cuts are normal and the trend has repeated itself historically. There were even price cuts last year as the housing price growth in Colorado seemed unstoppable. The number of sellers cutting their list price in June is now in double digits in the U.S. as well at 14.5%.
It’s normal because homeowners who cut their listing price often “overprice and don’t realize (declining) market value,” Zillow economist Nicole Bachaud said.
Denver and Fort Collins both were below the national average for the median size of price cuts. But both places are increasing. The median price cut in Denver was 2.7% in June, compared with 3.3% nationwide. In spring 2021, Denver’s median price cut was 2.3% while the U.S. was 2.9%. Denver was also at a historical low when it came to the number of listings with price cuts at only 6.1% of houses.
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If there is a home that you would like more information about, if you are considering selling a property, or if you have questions about the housing market in your neighborhood, please reach out. We’re here to help.
