10 Best Housing Markets for Home Price Discounts

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best housing markets to find discounts: price reduced signNow is the bargain real estate season: asking home prices typically hit their seasonal low point from November through January. This winter, however, home price discounts are harder to find. Among all non-foreclosure homes for sale on Trulia in early January, 33.6 percent of homes were priced lower than their original listing price. (For homes originally listed more than six months ago, we compared the current price to the price six months ago, not the original price.) One year ago, in early January 2012, 36.7 percent of homes for sale were marked down from their original listing price.

However, the national average of 33.6 percent hides huge local differences. In January 2013, the share of homes with price discounts ranges from just 15 percent in Oakland, Calif., to 48 percent in Springfield, Mass. Among markets with the fewest reductions today, Miami and Fort Lauderdale stand out as the two locales that also had relatively few reductions one year ago.


Springfield, Mass., on the other hand, has the most price discounts in the country, followed by Hartford, Conn., and Omaha, Neb. Of the 10 metros with the highest share of price reductions, five are in New England. The rest are in the Midwest or nearby. Most of the markets with lots of markdowns at the start of 2013 had even more price reductions at the start of 2012. In fact, among the 100 largest metros, 83 have fewer price discounts now than one year ago.

What explains why some metros have few markdowns, while others have many? Two factors stand out among markets with fewer reductions: bigger price gains and a lower vacancy rate. In metros where prices are rising, asking prices are less likely to start out too low: Oakland, Las Vegas, and Miami all had big price gains in 2012, according to the December Trulia Price Monitor. In metros with low vacancy rates, buyers are competing with each other for the few available homes on the market, so sellers don't need to lower prices to attract buyers: Ventura County, Calif., for instance, had only a 0.9 percent year-over-year increase in prices in December 2012, but has among the lowest vacancy rates in the country, which means sellers don't need to drop prices to attract interest. Overall, a decline in price reductions is yet another sign that the housing market is tightening. Take a closer look at the 10 markets where price reductions are everywhere.

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10 Best Housing Markets for Home Price Discounts

January 2013: 48% of homes on the market have had price reductions

January 2012: 48% of homes had price reductions

Springfield's median home sales prices have been on the decline recently, and with its stash of 944 homes on the market that are in some stage of foreclosure (compared to 590 homes on the market that are not), it's easy to see why price reductions are happening there.

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Photo: Wikimedia Commons

January 2013: 45% of homes on the market have had price reductions

January 2012: 45% of homes had price reductions

Listing prices and median home sales prices are looking up in Hartford, but you'll still find discounts around town. Prices in the city were hit had in the housing slump, so even though they're up recently, it still requires some price reductions to move homes on the market.

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Photo: Wikimedia Commons

January 2013: 45% of homes on the market have had price reductions

January 2012: 46% of homes had price reductions

Zillow shows that home values in Omaha are down 22% year-over-year. Now that's not terrible news because home prices never plummeted in Omaha as badly as they did elsewhere, but it still goes to show that home price reductions are necessary there to get homes off the market.

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Photo: Wikimedia Commons

January 2013: 44% of homes on the market have had price reductions

January 2012: 47% of homes had price reductions

Worcester has been the less-expensive alternative to Boston, with many urban dwellers leaving the big city to finding cheaper houses in Worcester. MSN called it one of the best housing markets of 2012, but prices are still far from where they used to be. They've probably hit bottom, and meager growth is expected this year.

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Photo: Wikimedia Commons

January 2013: 44% of homes on the market have had price reductions

January 2012: 46% of homes had price reductions

Average listing prices and median sales prices have remained fairly steady in New Haven, but the number of home sales has been dropping. So price reductions on homes could be the ticket to keeping the market from going stagnant.

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Photo: Wikimedia Commons

January 2013: 44% of homes on the market have had price reductions

January 2012: 50% of homes had price reductions

The number of home sales in Buffalo has plummeted, even though listing prices have generally gone up recently. Such anemic activity could explain why so many sellers are lowering their prices to entice buyers.

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Photo: Wikimedia Commons

January 2013: 44% of homes on the market have had price reductions

January 2012: 48% of homes had price reductions

Home prices are on the up-and-up in Peabody, but here's the catch: According to Trulia, there are 98 resale or new homes on the market, but there are also 127 homes in some stage of foreclosure on the market as well. That may explain the need for price drops to get those homes sold.

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Photo: Flickr/openroads.com

January 2013: 44% of homes on the market have had price reductions

January 2012: 48% of homes had price reductions

Forecasts show that Lake County home prices are expected to fall moderately this year. So you can expect asking prices to take a hit during that trend. The average listing price in Kenosha County has been on a bit of a roller coaster ride. So far in January, they went up and then back down, Trulia data shows.

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Photo: Wikimedia Commons

January 2013: 43% of homes on the market have had price reductions

January 2012: 47% of homes had price reductions

The Chicago housing market has been slow to recover, and it's expected to lag behind many other cities in 2013. That's why, even though price reductions are down from 2012, there are still plenty of them out there.

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Photo: Wikimedia Commons

January 2013: 43% of homes on the market have had price reductions

January 2012: 45% of homes had price reductions

It might be a slightly downward trend in Kansas City, but there are still a high number of homes that have had prices chopped. The average listing price in the city is $167,209, but median home prices have been sliding, so that could go down.

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Photo: Wikimedia Commons

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Jed Kolko is the chief economist for online listings site Trulia. This article originally appeared on the Trulia Trends blog.

See also:
Home Appraisals Lower Than Prices? What to Do
Guns at Home: Do Firearms Permits Lower Property Values?

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