So says a press release from Zillow this morning. The really disappointing thing for me is that I can’t find in any of their MSA’s (metro statistical areas) a city within 50 miles of Athens. Even after going on their Website and downloading the Excel spreadsheet of all 150 or so MSA’s nothing near Athens, GA showed up on their map. Nationally what this report does show us is the following, (according to August Zillow® Real Estate Market Reports)
* Buyers pay 3% less than listing price in August, down from 3.3% in July and 4.5% in January (according to the Athens MLS this figure is closer to 5% locally, but this also can broaden depending on price range)
* 24.7% of all unsold homes had at least one price reduction as of Oct. 1, 2009
In their press release Zillow states, “Homebuyers in much of the U.S. are still paying thousands of dollars below the home’s asking price, but had slightly less negotiating power in August than they did in July, according to the August Zillow Real Estate Market Reports. Buyers paid a median $6,525, or 3 percent, less than the last listing price on homes bought in August, down from $7,018, or 3.3 percent, less for homes bought in July.”
They go on to point out that Buyer “negotiating power” peaked out in January of this year. For sellers that still insist on no price reductions, roughly 24.7 percent of all homes listed for sale on Zillow had “at least one” price reduction. They point out the median price reduction to be about 7 percent off original or initial offering price. This is especially crucial in our market where if you are in Athens-Clarke and your home is price above $250,000 or Oconee County, GA and your home is priced above $300,000 and you haven’t gotten any bites yet, this should hopefully be speaking volumes to you. 120 + days on market with few showings and no offers probably means you are over priced. Please always keep in mind that in this fast changing market I have seen homes priced correctly and within 60 days new listings come out on the market on either side of a particular home make that price that was deemed correct when it was put on the market now “too high” all of a sudden.
“Negotiating power is a clear reflection of inventory levels, which dropped nationally in August. Tighter supply in some markets is translating into less of a discount off listing price,” said Zillow Chief Economist Dr. Stan Humphries. I would completely agree on that point. What I would add to my faithful blog readers is that I have always tried to indicate however that while the Zillows, NAR, Trulia, etc…speak in terms of MSA’s and national markets that real estate is “hyper local”. For example, in a recent blog post I discussed inventory levels in Athens and then broke it down in various neighborhoods around town. The specific neighborhood you live in and the number of homes for sale in that neighborhood coupled with the number of sales in that subdivision over the past six months will have a very specific affect on the housing supply from one neighborhood to another.
This can affect things like negotiating power very heavily. Dr. Humphries goes on to say, “Unfortunately, the brisk spring and summer home shopping season is drawing to a close now, and with foreclosures on the rise again, inventory levels will likely head back up in the coming months, leading buyers’ negotiating power to regain the ground it lost in August.” We will see. In our local market we have seen a fairly consistent 5 percent off list price for the past year. Again, real estate is local, and not just local but “hyper local.” 
For weekly Athens area market conditions try Market Snapshots. This is a great resource and I know you will be impressed. www.AthensHomeTrends.com
