Homes Sold for Less Than the List Price in These Metro Areas in August 2022

It was just about a year ago when RE/MAX National Housing Report showed home sellers, on average, accepted offers below their listing prices last month.

Sellers in the Washington D.C. metro area were accepting offers that were, on average, 16% below the list price during the month of August – and in Bozeman, Montana and Coeur d’Alene, Idaho, sellers were accepting offers 3% below their list price, on average.

Could this be the market rebalancing, a sign that 125 consecutive months of a run-up in home prices was in fact, unsustainable long-term? RE/MAX President and CEO Nick Bailey seems to think so.

In a recent episode of Bailey’s live web show, Keepin’ It Real with Nick Bailey, he explains why the current market shift may seem radical to some. After all, Bailey says, home prices have predominantly increased over the past decade.

August 2022 saw a shift in that directionality. The month recorded an average close-to-list price ratio of 99% in the report’s 51 measured metro-areas, down from 101% compared to July 2022 and down from 102% compared to August 2021. The close-to-list price ratio is calculated by the sales price divided by the list price for each transaction. It’s simple – when the number is above 100%, the home sale closed for more than the list price. If it’s less than 100%, the home sold for less than the list price.

This change was likely the impetus for August sales going 5.3% higher than July. August also saw a month over month 2.4% decline in Median Sales Price to $410,000 after peaking at $426,000 three months earlier.

“Patient buyers were rewarded in August, as prices softened from July. Sales increased as buyers ‘bought the dip’ – which was not the trend many people were expecting. The activity modestly depleted inventory, although the number of homes for sale remains significantly higher than this time a year ago,” Bailey said in the report. “The late-summer burst of activity underscores the housing market’s resiliency. Despite the uptick in interest rates and concerns about the economy, demand remains strong. We’ll see what happens from here, but the August bump in sales was great news for the industry.”

RE/MAX Executive Realty real estate agent Gina Mayes Harris, who is based in Charlotte, NC, agrees. In the latest housing report she says, “The Charlotte market is showing strength for both buyers and sellers with homes now selling at market value. Buyers are no longer bidding against each other to extremes, and while sellers are not seeing the same level of price appreciation gains as they have in the past year or two, we expect continued low single-digit appreciation in the coming months and year. All signs point to a more balanced market providing plenty of opportunities for buyers and sellers.”

In follow-up conversation, Harris suggests actions from real estate agents could help quell any fears of a housing market crash and concerns on whether this was a “good time” to be pursuing real estate goals.

“All agents should be clearly communicating what their client should expect with the market normalizing. Educating the players (buyers, sellers, other agents and vendors) is of utmost importance to place your client in a strengthened position,” she says.

If you’re looking to buy or sell, on the fence about either, or just curious about how the transition may affect the housing market, here’s the need-to-know data in the latest RE/MAX National Housing Report:

1. Home Sales Saw a Month-Over-Month Increase

Of the 51 metro areas surveyed in August 2022, the overall number of home sales was up 5.3% compared to July 2022, and down 20.1% compared to August 2021. The markets with the biggest decrease in year-over-year sales percentage were Bozeman, MT at -44.1%, Las Vegas, NV at -37.3%, and Phoenix, AZ at -31.4%. No metro area had an increase in year-over-year sales percentage.

2. Homebuyers Have a Bit More Time to Shop

The average days on market for homes sold in August 2022 was 28, up four days from the average in July 2022, and up three days from the average in August 2021. The metro areas with the lowest days on market were Dover, DE at 10, Baltimore, MD at 11, followed by a tie between Philadelphia, PA and Washington, DC at 13. The highest days on market averages were in Fayetteville, AR at 63, followed by a tie between New York, NY and Seattle, WA at 47. Days on market is the number of days between when a home is first listed in an MLS and a sales contract is signed.

3. Demand Continues to Outpace Supply (but Supply Improved Year-Over-Year!)

While the number of homes for sale in August 2022 was down 1.8% from July 2022, it’s worth noting the metric is up 20.0% from August 2021. Based on the rate of home sales in August 2022, the months’ supply of inventory decreased to 1.6 compared to 1.7 in July 2022, and increased compared to 1.2 in August 2021. In August 2022, the markets with the lowest months’ supply of inventory were a tie between Albuquerque, NM and Manchester, NH at 0.7, followed by another tie between Charlotte, NC and Hartford, CT at 0.8.

If you’re looking to buy or sell, a RE/MAX agent can help navigate this changing environment and serve as a trusted advisor for one of the largest transactions in your lifetime.

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