For the past few years, homebuyers have been waiting for a sign that home prices might finally start coming down.
Well, after years of sky-high home prices, bidding wars, and homes selling within hours, there are signs that the market is finally shifting in favor of buyers. While we’re not seeing a dramatic drop in prices, recent data shows that homes are now selling for about 2% below asking price on average—a welcome change after years of sellers having the upper hand.
This may not sound like much at first glance, but for buyers, it’s a big deal. Home prices aren’t “crashing,” but buyers now have something they haven’t had in a long time: leverage. And if you know how to use it, you can land a better deal than you would have just a year or two ago.
Thanks to a combination of rising inventory levels and a slight softening in demand, the playing field is shifting. According to Redfin’s analysis on homebuyers paying under the list price, this 2% average discount is more than just a number. It reflects a broader change in dynamics where buyers are seeing several other advantages, such as:
- Less competition. Part of the reason for prices coming down is likely due to some buyers taking a break from actively looking for a house.
- More time to make decisions. It’s taking 56 days on average for the typical home to go under contract, which is the longest span in nearly five years. In addition, more than half (56%) of listings are sitting on the market for at least 60 days.
- Greater flexibility on inspections and contingencies. Many buyers have been entirely waiving their rights to inspections and other contingencies in order to make their offer more appealing. Now there is a greater chance you can not only do inspections, but also find that sellers are more willing to agree to do repairs and be open to concessions.
That Doesn’t Mean Every Home Is Negotiable…
While the market has softened, it’s important to stay realistic. Not every home will sell for below asking price, and some homes are still getting multiple offers. Here are a few scenarios where you still might not be able to negotiate the price of the home below asking price:
- If it’s well-priced – Regardless of the real estate market or overall economy, a home that is priced appropriately will usually generate a lot of interest and can easily lead to a bidding war, and sell for above the asking price.
- If it’s move-in ready – Homes that are in good condition, especially if they were recently updated, are still in high demand in most areas and price ranges.
- If the house is unique or highly sought after – If a home has special features (a great view, updated finishes, a rare floor plan), buyers will likely still compete for it.
- If demand is high in the area and price range – Unfortunately, national averages don’t trickle down to every single market. So if you’re in a high-demand area or price range, you might not be able to negotiate price and terms as easily as in other areas.
…but Here Are Some Tips for Finding Ones That Might Be Negotiable
It’s difficult to say whether the spring market will bring an increase in buyer activity, which could easily shift the momentum back in the favor of sellers, so this might be a momentary opportunity. If you want to capitalize on the market trending down, make sure to start looking now for homes where the seller may be more willing to accept a lower offer.
Here are some tips for finding them:
- Hire a great buyer’s agent – Work with an agent you feel will be able to not only identify the best opportunities, but also negotiate the best price and terms for you.
- Look for homes that have been sitting on the market – Many buyers presume there must be something wrong with a house if it’s been sitting on the market for some time, and often focus their attention on new listings. You may even want to have your agent find homes that have specifically been lingering on the market the longest, and focus your attention on those properties.
- Carefully look for overpriced listings – There is a lot of danger to looking at homes above your price range. It’s way too easy to fall in love with a home you can’t actually afford, and it can make it difficult to be content with great homes within your price range. However, there may be overpriced homes that should be in your price range which are sitting on the market because they aren’t priced appropriately. Ask your agent to use their judgment and present you with homes they feel are poorly priced, and confident they could negotiate down to a price within your budget.
- Don’t overlook homes that need some work – Move-in-ready homes still attract strong competition. But if you’re willing to take on a home that needs a little cosmetic work, you might be able to avoid some competition and negotiate a better price.
- Negotiate beyond just the price – Price is only one part of the deal. Sellers may be willing to cover closing costs, offer credits for repairs, or be flexible on terms like move-in dates.
The Takeaway:
The market is finally shifting in favor of buyers—just a little, but enough to make a real difference. While home prices aren’t plummeting, they are selling for about 2% below asking price on average, giving buyers some much-needed leverage. That means less competition, more time to make decisions, and a better chance to negotiate on price, repairs, and terms.
But not every home will be up for grabs at a discount. Well-priced, move-in-ready, or highly desirable homes can still attract multiple offers. If you’re looking for a deal, focus on homes that have been sitting on the market, are overpriced, or need a little TLC. And don’t forget: negotiation isn’t just about price. Sellers may be willing to offer concessions, so work with a great agent who knows how to spot opportunities and negotiate the best deal for you.
