Chilling sign housing crash is underway as sellers panic-cut prices at highest level in 13 years
Homebuyers finally struck gold last year as sellers raced to slash asking prices at the highest levels since the aftermath of the 2008 financial crisis.
The shift marks a sharp reversal from the post-Covid housing boom when ultra-low mortgages and fierce demand handed sellers the upper hand and sent prices soaring.
That balance of power has now flipped as buyers fed up with high prices increasingly hold off purchases, even as more homes are put up for sale.
This has created a firm buyer’s market. There are now more homes for sale than there buyers - leaving sellers with little choice but to cut prices if they want to close a deal.
New Redfin data now shows that buyers, now in control, confidently forced sellers into deep discounts on home prices. In fact, those who talked sellers down typically walked away with 8 percent off, the steepest price cuts seen since 2012 - the tail end of the last major crash.
That translated to roughly $31,600 in savings, based on last year's median list price of $399,000. Across the entire market - including buyers who paid full price - the average discount still came in at $15,200, or 4 percent off.
And this wasn't a rare win. Last year around 62 percent of buyers paid less than the asking price, the highest share since 2019.
Some scored especially sweet deals - about one in four shaved 10 percent or more off, while another quarter landed 5 to 10 percent discounts. Small, token cuts became the exception, not the rule, as fewer buyers settled for savings under 5 percent.
These wins came amidst the strongest buyer's market in recent history. There are a record 47 percent more home sellers than buyers, giving house-hunters more options and power in the market.
Buyers are pulling back because mortgage rates and home prices are high, but some sellers haven't caught up to how much the market has cooled.
Many are still pricing their homes like it's the pandemic boom, when neighbors were selling for tens of thousands over asking. This is especially true for people who bought at the peak and now want to sell high so they don't lose money.
'Some sellers are recognizing the market has changed and others are not,' said Connie Durnal, a Redfin premier real estate agent in Dallas.
'I have one seller who overpaid for their home a few years ago and wants to list it at $950,000. The problem is recent comps call for a list price of $825,000. I have another seller who paid $400,000 for their home but was willing to list it at $385,000, which was a great strategy. Because the home was fairly priced, it got multiple offers and sold for $10,000 over the asking price.'
The problem is the market isn't that hot anymore. As a result, more sellers are cutting prices - or taking their homes off the market and waiting for better days.
'Homebuyers in 2026 shouldn't write off homes that are slightly above their budget because there's a good chance they'll get some sort of concession from the seller, be it a price cut, money toward closing costs or funds for repairs,' said Redin senior economist Asad Khan.
'This marks a reversal from the pandemic homebuying frenzy, when house hunters were advised to search for homes below their budget because fierce bidding wars were causing properties to sell far above the asking price.'
The United States as a whole has been firmly in buyers' market territory for months now
Connie Durnal, a Redfin premier real estate agent in Dallas (pictured), said: 'Some sellers are recognizing the market has changed and others are not'
Condo buyers got the biggest price breaks last year
Redin senior economist Asad Khan
Condo buyers got the biggest price breaks last year.
On average, condo shoppers paid about 8 percent less than the asking price - it was the first time in over a decade that condos sold at deeper discounts than single-family homes.
Condo demand has cooled because HOA fees and insurance costs are rising, and some associations are charging large one-time fees.
Last year, only four metro areas saw buyers regularly pay more than the asking price.
San Francisco topped the list, with buyers paying about 4 percent over. The others were Newark, New Jersey; San Jose, California; and Oakland, California.
The Bay Area market has picked up again thanks to growth in the AI industry and more workers returning to offices. Homes there also often sell above asking because sellers sometimes list low to spark bidding wars - but those extra premiums are getting smaller.
On the other end of the spectrum, homebuyers in West Palm Beach scored the biggest bargains last year, paying an average of 10.9 percent below asking prices - the largest discount among the 50 largest US metros.
Detroit and Fort Lauderdale followed at 10.3 percent, with Pittsburgh and Miami close behind. Florida’s abundant housing supply, rising insurance costs, and higher condo fees gave buyers extra leverage.
