Zillow July Market Reports: Florida Homebuyers Have Most Negotiating Power
By: Katie Curnutte, Zillow PR Manager | September 9, 2009
It’s an opportune time for homebuyers to negotiate, especially if you’re aiming to purchase a house in Florida.
According to the July 2009 Zillow Real Estate Market Reports, July homebuyers paid 3.3%, or a median $7,039, less than the last listing price of the home. That’s on top of the price reductions that sellers are making before they get to the negotiating table - 22.8% of all listings on Zillow had a price reduction before the end of August, and the median price reduction was 6.5%.
In some Florida metros, that savings is even greater.
Vero Beach, Fla.-area homebuyers negotiated a median 10.2% off the last listing price of the home, saving $23,500.
In the Sarasota metro area, buyers paid 8.2%, or a median $20,392 less than the last listing price.
Below are the top 25 metro areas where buyers are negotiating the most.
On the other side of the coin, after years of continued home value declines, some California home sellers are now getting more than their asking price. In the El Centro market, buyers paid 1.8%, or a median $2,150 more than the asking price. In several other California metro areas - Sacramento, Merced, Modesto, Riverside, Stockton, Yuba City and Fresno - asking price and sale price were the same. These same markets have some of the highest rates of foreclosure in the country, and are now experiencing growing sales volumes due to investors and first time buyers purchasing distressed properties. This is bringing down inventory levels, giving buyers less to choose from and causing some sellers to receive competing bids.
One caveat for those raring to buy a home: Home values are continuing to fall in most areas of the country, and although the rates of decline in many places are shrinking, it will likely take some time before values stabilize. When they do, the bottom could be quite protracted, meaning it might be years before home values start to rise on a consistent basis. If you are thinking about buying a home, make sure you have a healthy down payment to shield you from negative equity, and plan on staying in your home for a minimum of five to seven years.
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- Categories: Real Estate Analytics
Comments
3 Comments so far
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Gainesville Realtors on September 10, 2009 8:53 pm
We would agree that this is true.
abe vigoda on September 11, 2009 6:54 am
What a joke. Buying a house for 7% less than LISTING price is a BARGAIN in this market? That hardly covers your closing and other costs of purchase.
It’s a known fact that prices in many areas prices have retraced to 2003-2002 levels. That is a decent starting point for negotiating, as prices will most likely continue to fall for the foreseeable future.
A healthy down payment does nothing to insure against negative equity if you overpay. Case in point, look at all of those knife catchers from 2007-2008 that thought they bought at the bottom. Many are now underwater.
natp on September 13, 2009 2:33 pm
Agree with Abe. Especially in the S Florida region, you are still seeing some overvaluation. With umemployment at 11% in Florida and investors running dry on capital, buyers should wait it out to get the good deals. When the Wall Stree Journal says the bottom of the real estate market is here, it just doesn’t apply to Florida - you could get a really good buy if you wait for another 4-6 months.