As the housing market shows signs of stabilization, home buyers are seeing their leverage over sellers dissipate, according to a new report from Zillow, a real estate information service. The report found that, nationally, buyers paid an average of 3.3 percent—or about $7,000—less than final listing prices in July, which is a substantially smaller bargain than the 4.6 percent—or $10,260—discounts they landed in January. "The strong summer selling season in 2009 has led to a decreasing difference between the last listing price and final sale price," Stan Humphries, Zillow’s chief economist, said in a news release issued Wednesday.
Here are five things you need to know about this development:
1. Florida: bargain hunter’s paradise: Home shoppers in Florida were able to squeeze the largest discounts out of sellers. In Vero Beach, for example, buyers were able to knock 10 percent—or a median of $23,500—off the listing price. Buyers in Sarasota landed discounts of about 8 percent. "The fact that many Florida markets are still showing comparatively higher differences between the last listing price and final sale price suggests that inventory levels are still relatively high, keeping considerable downward pressure on prices and encouraging buyers to seek large discounts off the listing price," Humphries said. However, certain hard-hit markets in California were less kind to bargain shoppers. In El Centro, home buyers had to fork over nearly 2 percent more than listing prices. In other parts of the state—such as Stockton, Merced, Sacramento, Fresno, Modesto, Yuba City, and Riverside—asking and listing prices were about the same.
2. Housing market stabilization: After a historic string of ugly data, news out of the housing market has turned increasingly optimistic in recent months. July’s new-home sales report showed raw inventory at its lowest level since 1993, according to Mike Larson of Weiss Research. At the same time, existing home sales increased for the fourth month in a row, while the pending home sales index hit its highest mark since June 2007. Meanwhile, the most recent Case-Shiller home price report showed that the pace of price deflation is moderating. "The overall trend toward stabilization is undeniable at this point," Larson said in a recent report.
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