These include the Bay Area, Las Vegas and Phoenix, according to the latest Zillow ranking of national buyers’ and sellers’ markets.
For those looking to buy a home, Midwestern and Mid-Atlantic metros including Chicago, Cleveland and Philadelphia offer the most favourable conditions, with price discounts exceeding 5% in some areas and listings remaining active in some cases for 100 days or more.
Zillow analysed data on actual sales prices compared to asking prices, the number of days listings spent on Zillow and the percentage of homes on the market with a price cut, and ranked the 30 largest metro areas in the country to determine whether buyers or sellers have more negotiating power in a given market.
In this analysis, a sellers’ market is not necessarily one where home values are rising, but rather one in which homes are on the market for a shorter time, price cuts occur less frequently and homes are sold at prices very close to, or greater than, their last listing price. In buyers’ markets, homes for sale stay on the market longer, price cuts occur more frequently and homes are sold for less relative to their listing price, giving buyers more negotiating power.
‘As most housing markets continue to improve nationwide, the relative position of buyers and sellers continues to vary considerably by geography,’ said Zillow chief economist Stan Humphries.
‘In some markets, buyers are finding themselves in strong bargaining positions relative to sellers, confidently offering less than the asking price on a home they had months to consider. In other areas, it’s sellers that are squarely in the driver’s seat with their homes selling within days of listing, often after bidding wars that increase the sale price above the asking price,’ he explained.
‘Many of the strongest sellers’ markets are in areas that were hardest hit by the housing bust, places like California, Nevada and Arizona, which may seem counter intuitive. But much of that strength is driven by investor interest, as many distressed and non-distressed homes are purchased and transformed into rentals. This investor activity is contributing to very low inventory levels, which increases demand and helps drive up prices, particularly for less expensive homes in these markets,’ he added.
