Signs it’s time to lower the price of your home

Key Takeaways

• A lack of viewings, declining online engagement and no serious offers could indicate that your home is too expensive.
• About 20.2% of active listings nationwide have lowered their asking price.
• The most effective price cuts are meaningful enough to attract new buyers, often around 2% to 5%.
• In some cases, concessions to the seller can be more effective than lowering the price.

In today’s housing market, buyers have more options and more bargaining power than they did just a few years ago. About 20.2% of active listings nationwide have lowered their asking price, and many homes are taking longer to sell than they did just a few years ago. If your home isn’t attracting showings or offers, a price adjustment can help reignite interest and get your sale back on track.

Pricing strategy in today’s market

The days of the pandemic housing boom — where sellers could list a home at an aggressive premium and see multiple invisible offers pop up in a single weekend — are over. The current real estate ecosystem requires flexibility. Nationally speaking, approximately 20.2% of all active offers have a price reduction.

While that is down slightly from 21.0% a year ago, price cuts remain much more common than before the pandemic. Sellers have become more realistic about pricing from the start, reducing the need for subsequent adjustments. Still, buyers generally have more options and bargaining power than they did just a few years ago, making accurate pricing more important than ever.

“Earlier this year, homes remained on the market and price drops were quite common as sellers did their best to attract buyers. But sellers are more attuned to current market conditions and price accurately from the start to minimize risk.” – Justin Gomez, Redfin premier agent

How to keep your home from becoming too expensive before you put it on the market

• Price for the next 30 days, not the last 3 years: Don’t look at what your neighbor’s house sold for during the peak of the pandemic boom. Instead, have your agent pull up local neighborhood comps (comps) from the past 30 to 60 days to see what active buyers are actually paying right now.
• Price under psychological brackets: Most buyers set hard search filters on real estate apps (limiting their search to $400,000). If you price your house at $405,000, you will completely hide your listing from anyone filtering up to $400,000. The price of $399,000 immediately attracts a huge group of buyers.
• Please consider your local stock: Real estate is hyper-local. If you live in a cooling Sun Belt metro like San Antonio or Phoenix, more than half of all sellers are lowering prices because the inventory is high. If you’re in a highly competitive market like San Francisco, inventory is tight, which means you have more leverage to meet your numbers.
• Test the waters early: Tools like Redfin Early Access allow sellers to market their home as a “coming soon” listing before it officially hits the market. Early feedback from buyers and agents can help you gauge interest, refine your pricing strategy, and potentially avoid a price cut later.

How long should you wait before lowering your asking price?

Timing a price cut is an exercise in data rather than emotion. If you lower the price too quickly, buyers may assume there is something structurally wrong with the home. If you wait too long, your house will become a “outdated list”, thus losing its competitive advantage.

The appropriate timeline depends on your market and the level of buyer interest in your home. Pay close attention to the following signals in the first few weeks after admission.

Signs that it is time to lower your asking price

Buyers look but don’t bid

If your listing is viewed, saved and shown, but no serious offers are made, buyers may like the house but feel the asking price is too high.

Feedback consistently mentions price

Pay attention to feedback from buyers and agents. If several people say the house feels too expensive or compares it unfavorably to cheaper listings in the area, the market may be signaling that an adjustment is needed.

Competing homes are priced lower

If similar homes in your area If they enter the market at lower prices or sell faster, buyers are likely to choose those properties first.

Bids are significantly below the asking price

Low offers can be frustrating, but often provide useful information. If multiple buyers come in at well below your asking price, this could indicate that the market is valuing the home differently than you are.

The house is valued below the asking price

Like one valuation is below your list price, buyers using financing may have difficulty moving forward without renegotiating.

If your listing shows several of these symptoms within the first two to three weeks, it may be time to reconsider your pricing strategy. If you wait too long, you may have more days on the market and buyers may wonder why the house hasn’t sold.

How much should you reduce the price?

When making a price cut, avoid the temptation to dip your toe in the water. Making a series of small, nominal price cuts (such as a $2,000 discount on a $500,000 home) often goes unnoticed by buyers. They may not generate new interest, succeed in placing your home in a new search category, or meaningfully change buyers’ perception of value.

To make an impact, consider a price reduction of 2% to 5%:

• For a $400,000 house: A 4% decrease translates to a reduction of $16,000. This will reduce your home to $384,000, immediately addressing buyers who have limited their home search filters to $390,000 or $385,000.
• National baseline: In the United States, sellers who lowered their asking price lowered it by an average 4.0%.

A single, meaningful price reduction is often more effective than a series of small reductions spread over several weeks.

Should you lower the price or make concessions?

Sometimes lowering the price is not the best solution. If buyer hesitation is caused by macroeconomic factors such as high mortgage rates and not by the intrinsic value of the home, concessions from the seller can be a more effective way to attract offers.

Of vendor concessions near record highs In many markets, buyers expect more and more flexibility during negotiations.

Option A: The immediate price drop

Best for: Improving the visibility of listings. Real estate portals will re-alert any buyer who previously held the house, quoting the lower price. It also drops your home into lower price filters.

Option B: Seller Concessions

Best for: Helping buyers manage initial costs or affordability issues. Instead of lowering the price of the home by $15,000, you can offer a $15,000 line of credit that the buyer can use toward closing costs, repairs, prepaid expenses, or other eligible costs of purchasing a home.

In some cases, seller concessions can be more attractive than a price reduction because they reduce the buyer’s out-of-pocket expenses while allowing you to maintain your asking price. A common example is a mortgage interest redemptionwhich can help reduce a buyer’s costs monthly payment during the first years of the loan.

Avoid chasing the market

The ultimate risk of waiting too long to lower your price is that the market may move on without you. In areas where inventory is growing, setting your price too high means you’ll always be one step behind what buyers are willing to pay. By being proactive price of house With current market conditions and comparable sales, you can maintain momentum, attract stronger offers, and increase your chances of selling faster.