“Another sign that the market has change is the considerable number of price reductions. 10% of the market changes the asking price every week now”
Steven Thomas, The Orange County Housing Report, Nov 11, 2013
For the last year or so investors with pockets of cash were outbidding typical homebuyers, forcing prices up and instilling a false confidence in many sellers and their agents that the market would bear almost anything they asked for. Once interest rates took a slight turn up (then came back down) and investors retreated a bit, the market turned. Today, overpriced listings sit on the market and sellers are either reducing their asking prices or pulling their properties off the market. The upside for buyers is that interest rates are still some 4 points below their historical average (still as close as we’re likely to see to “free money”) and they now actually have the opportunity to negotiate with a seller for a good buy on a home, rather than engage in a contest to see who can bid the most over asking price to win seller’s approval.