Skip to main content

Where Are The Deals? Buyer's Markets Are Taking Hold In These Cities First


Phoenix, Ariz. is looking more and more like a buyer's market. 

Getty

All signs are pointing towards a shift away from the tight sellers' market we have been in for years towards one that gives buyers a little more negotiating power. Price growth has started to stall, inventory is on the increase and if you look at data from a variety of real estate tech firms, their data start to reflect similar trends. Redfin agents saw a large decrease in bidding wars for their clients, going from 61 percent in March of 2018 to only 16 percent for March of 2019; the ShowingIndex by the home showing booking firm ShowingTime indicates a slowdown; and according to Zillow, March 2019 was the 7th straight month of inventory gains which hasn't happened since 2014. The biggest question on everyone's mind is where the markets are slowing down the most so the good deals begin to surface before any of the other cities. There are two places to look first to get a sense of where the markets are heading.

The home trading platform Knock has released a list of cities they predict will have the highest number of current on-market listings sell below their asking price, along with the percentage of homes in that market they predict will sell under asking.

  1. Miami, FL: 89.65%
  2. Houston, TX: 82.74% 
  3. New Orleans, LA: 82.64%
  4. Tampa, FL:  82.24%
  5. Jacksonville, FL: 81.96%
  6. Chicago, IL: 81.50%
  7. Phoenix, AZ: 80.33%
  8. Hartford, CT: 79.99%
  9. Orlando, FL: 79.57%
  10. St. Louis, MO: 78.40%

According to their report, they used machine learning to process 200 features across the top U.S. metropolitan areas to come up with these predictions. As with many real estate analyses there are always two tiers to the market that drive the data—the high-end and mid-price ranges. The fact that luxury-heavy Miami tops the list as having the largest percentage of homes that will sell under asking could be a reflection simply of the softening upper in the mid-level luxury range. The very upper echelon of the Miami market happened to have a strong first quarter already, with nine "mega-estate" sales finding buyers and homes in the upper ten percent price bracket seeing a median sales price of $10.1 million (largely due to the favorable tax rates).

The data released by Redfin on bidding wars also points toward where the best markets will be to find a deal. Here is the table from their report showing where bidding wars have decreased the most around the country.

Bidding wars are down in most major markets. Click to expand.

Redfin

Keep in mind these numbers come from their own client activity only and with Redfin's varying market share in different cities around the country they are best taken as macro level trends comparing one year to the next. Yet it still shows many of those tech-strong markets which have been going gangbusters for so long are finally starting to see a slowdown. I doubt it can be called a course correction, those markets will have tech money pumping in to them for decades to come, so they will bounce back before too long. But for now, even though they are still some of the higher priced markets in the country, they could become good places to buy property as an investment that will pay off when the next influx of cash comes rushing in.

Me? I'm putting my money on Phoenix.

Follow @amydobsonRE

 


Where Are The Deals? Buyer's Markets Are Taking Hold In These Cities First curated from Forbes - Real Estate

Comments

Popular posts from this blog

Vacation rental company Vacasa buys Sterling Resorts

Vacation rental management tech startup  Vacasa  isn’t slowing down its ambitions to conquer the market: this week, it announced that it has purchased Sterling Resorts, a vacation management company on Florida’s Gulf Coast. Sterling has changed hands before: it was  bought by Pacifica Companies in 2015 and currently manages 450 homes. Now it will become a part of Vacasa’s effort to expand its presence in vacation destinations such as northern Florida, where Sterling is based. At the time of this latest purchase, Sterling’s home inventory was  down from 585 properties in 2015. Vacasa has raised more than $200 million since its launch ten years ago. Founder Eric Breon said he was motivated to start the company after struggling to find a satisfactory management solution for a cabin belonging to his wife’s family on the Washington coast. Now Vacasa seeks to provide rental property owners with “a seamless experience…through innovative technology and local staff,” that give them

In An Era Of WeWork, Co-Working Space NeueHouse Sits Above The Fray

NeueHouse CEO Josh Wyatt Seuss Moments In today’s cluttered co-working landscape, it can be hard for companies to makes themselves heard over the din. Elevated co-working space  NeueHouse  wants to create an unparalleled experience for creatives through elevated programming and outstanding design. NeueHouse describes itself as “ a private cultural and collaborative space for prominent creatives, artists and entrepreneurs,” with current locations in Los Angeles and New York. In November, following an announcement of $30 million in funding , the company announced Josh Wyatt as its new CEO. Wyatt is a veteran of the hospitality industry, having co-founded Generator  in 2007, a chain of culture-focused hostels targeted at millennials, before moving on to Equinox to head the fitness brand’s hotel developments in New York City. Forbes interviewed Wyatt to talk about creativity, design, the gun threat incident at NeueHouse New York, and why he isn't phased by his "800 p

Could Ken Griffin's Penthouse Purchase Cost NYC Real Estate Buyers Millions?

'The Billionaire's Bunker' at 220 Central Park South is pictured on January 24, 2019, in New York - Hedge fund billionaire Ken Griffin has completed the purchase of a four-story penthouse in the building for $238 millionm- the most ever paid for a home in the US. The building is a residential skyscraper that is currently under construction. (Photo credit: TIMOTHY A. CLARY/AFP/Getty Images) Getty A 2014 bill that aims to impose an additional tax on part-time New York residents—dubbed the “pied-a-terre tax”—has risen from the dead, largely in thanks to the recent record-breaking Central Park penthouse purchase by billionaire Ken Griffin. Griffin, worth an estimated $11.7 billion and No. 45 on the Forbes 400 , reportedly bought the $238 million-dollar apartment “as a place to stay when he’s in town,” according to his representatives. The purchase drew widespread attention to the financial losses that part-time and foreign property owners can cause the city. Bec