For several years, one phrase completely vanished from our real estate vocabulary: price reduction. Instead, it was commonplace to see list price increases and incredibly rare for anything to sell below asking price. Now those two little words are back in abundance. The housing market news is full of headlines about sellers slashing prices and offering concessions. But while buyers certainly have more leverage in the market than they did two years ago, the full picture is less bleak for sellers than it may seem.
It’s true that price cuts are up overall. According to a report from HouseCanary, price cuts were up 133% year-over-year as of March 2023. That sounds concerning, but the report points out cuts are already down 63% since peaking in October. And when we look more closely, we can see shifts in home prices vary significantly by market — with certain cities seeing values drop while others continue to rise.
In fact, a healthy percentage of deals are still exceeding the seller’s asking price. According to a Redfin report, 26% of homes sold above list price in March. That’s encouraging news for agents and sellers who have been exposed to too many doom and gloom headlines about the real estate market lately. Especially with low inventory and rising demand coming into the spring selling season, there is a chance for agents who deploy the right pricing strategy to avoid the dreaded price cut.
It is worth noting there can be consequences of getting the price wrong: listing too high may cause the property to linger on the market and lose interest from buyers, while listing too low risks leaving money on the table or creating a negative perception that something is wrong with the home. Meanwhile, listing in the sweet spot can create interest and competition to give a better chance of selling for a higher price faster. The bottom line is that pricing the property accurately from the beginning is an effective way to maximize the sale price and avoid a price reduction down the road.
With time, money, and client satisfaction on the line, the stakes are high. Luckily, it’s now easier than ever to accurately estimate home prices. Intelligent pricing technology can pinpoint a suggested list price using big data and the latest advances in artificial intelligence (AI).
GeniuspricePro from homegenius Real Estate is one of the first pricing technologies of its kind to intelligently evaluate property condition. It’s powered by homegeniusIQ, a proprietary AI, image recognition, and photo analysis technology. Its cutting-edge models can identify and analyze room type, room condition, and more than 50 objects inside and outside of a home that may impact its value. All of this results in a more accurate price estimate based on the condition of the subject property and relevant comparables. GeniuspricePro can also help you give sellers confidence in the pricing strategy knowing it’s backed by next-level data science and tech.
Check out a demo of geniuspricePro to see how it can help you price your listings right from the get-go and potentially avoid price cuts that can harm your sale.
At homegenius, we’re transforming real estate transactions from beginning to end. We know that real change takes more than a bold vision. It requires decades of hard-earned experience, trusted relationships, and a capacity for connecting people and technologies across the real estate spectrum.
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