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Homes Sold Above List Price Fell to Three-Year Low in 2019

The dip reflects the slower market last spring, but a historic inventory shortage may put more money in sellers' pockets in 2020 as we enter home shopping season

- The share of U.S. homes that sold for more than their list price in 2019 fell to 19.9%, the lowest annually since 2016.

- Even with a significant cooldown from previous years, the California Bay Area remains the most competitive housing market in the country.

- Homes that sold above list last year typically brought in $5,100 more than the asking price, down from $5,500 the year before.

Feb 6, 2020

SEATTLE, Feb. 6, 2020 /PRNewswire/ -- As the housing market returned to normal after a frenzied couple of years marked by intense bidding wars in many markets, the smallest share of homes sold for above their list price last year than in any year since 2016.

Home value growth slowed throughout 2019 to a rate more in line with historic norms than the elevated levels of the past few years. About a fifth (19.9%) of U.S. homes sold for more than their asking price in 2019, according to a new Zillow® analysis, down from 21.5% the previous year. This drop breaks a streak of four consecutive years in which a greater share of homes sold above list price as the market picked up steam. 

But inventory is incredibly tight and this scarcity is a main driver of bidding wars that drive up sale prices, so we could be headed for a reversal in 2020. That's good news for prospective sellers, but means buyers will need to be on the ball this shopping season. Monthly trends in 2019 show that the share of homes sold above list was greatest in the fall months -- right as inventory was approaching its low point -- which is typically a slower time of year for the housing market after home shopping season wraps up. 

"The housing market took a breather in 2019, after years of red-hot sellers' markets," said Zillow Economist Jeff Tucker. "Many sellers were caught off-guard by the changing conditions, and ended up accepting offers at or below list prices that were dreamed up during the height of the frenzy. But the cloudy outlook for sellers began to clear late in the year after inventory buildups in several cities were whittled back down to record lows, suggesting a hot spring sellers' market is around the corner. Sellers hoping to cash in and upgrade should proceed with care, however, as the same tight conditions that may drive up their sale price will be facing them on the other side when they look to buy their next home."

Despite seeing recent year-over-year drops in home value, San Francisco (48.6% of homes sold above list) and San Jose (38.8%) top the list of metros with the greatest share of homes sold above list among the top 35 -- a sign of just how competitive the Bay Area remains even after cooling significantly in 2019. Boston (34.7%), Minneapolis-St. Paul (34.3%) and Seattle (31.2%) have the next-highest shares.

The coolest top-35 markets were Miami (8.9% of homes sold above asking), Las Vegas (12.6%) and Tampa (13.3%). Las Vegas fell from 26.8% a year ago, which was the 12th-highest share in the country. Only San Jose's share decreased by more, from 63.6% to 38.8%. 

The median amount above asking that sellers realized was $5,100, down from $5,500 in 2018 and the lowest since at least 2011. San Jose ($41,000 above asking) and San Francisco ($37,500) lead the country in this measure as well, a product of both intense competition among buyers and the high prices of real estate there making these figures relatively in line. Still, these figures are much lower than a year ago when San Jose homes typically sold for $101,000 above asking and those in San Francisco sold for $50,000 above asking. 

Metro

Share of Sales
Above List Price
- 2019

Share of Sales
Above List Price
- 2018

Median Amount
Above List Price -
2019

Median Amount
Above List Price -
2018

United States

19.9%

21.5%

$5,100

$5,500

New York, NY

19.3%

21.7%

$11,000

$11,000

Los Angeles-Long
Beach-Anaheim, CA

28.4%

34.8%

$12,000

$15,000

Chicago, IL

15.8%

17.4%

$5,000

$5,000

Dallas-Fort Worth,
TX

17.7%

24.2%

$5,000

$5,100

Philadelphia, PA

19.1%

18.3%

$5,100

$5,100

Houston, TX

13.6%

14.3%

$5,000

$5,000

Washington, DC

28.5%

25.8%

$7,000

$6,100

Miami-Fort
Lauderdale, FL

8.9%

10.1%

$6,500

$7,100

Atlanta, GA

19.8%

23.1%

$5,000

$5,000

Boston, MA

34.7%

40.0%

$11,100

$15,100

San Francisco, CA

48.6%

61.1%

$37,500

$50,000

Detroit, MI

19.3%

23.5%

$4,500

$5,000

Riverside, CA

22.9%

25.7%

$5,000

$5,100

Phoenix, AZ

17.1%

16.9%

$4,100

$4,100

Seattle, WA

31.2%

42.5%

$10,050

$19,000

Minneapolis-St Paul,
MN

34.3%

36.7%

$6,500

$7,000

San Diego, CA

22.6%

25.1%

$10,000

$10,000

St. Louis, MO

21.8%

20.2%

$5,000

$5,000

Tampa, FL

13.3%

14.5%

$4,500

$4,500

Baltimore, MD

21.7%

21.3%

$5,100

$5,100

Denver, CO

23.8%

34.3%

$6,100

$10,000

Pittsburgh, PA

17.0%

15.2%

$5,000

$5,000

Portland, OR

26.9%

31.7%

$7,300

$9,100

Charlotte, NC

21.3%

24.3%

$4,100

$4,500

Sacramento, CA

30.4%

33.3%

$6,000

$7,000

San Antonio, TX

17.8%

19.5%

$3,560

$4,000

Orlando, FL

13.3%

15.5%

$4,500

$5,000

Cincinnati, OH

18.3%

18.4%

$4,100

$4,000

Cleveland, OH

19.1%

18.3%

$4,100

$4,100

Kansas City, MO

26.9%

29.5%

$5,000

$5,000

Las Vegas, NV

12.6%

26.2%

$4,260

$5,000

Columbus, OH

29.5%

31.9%

$5,100

$5,100

Indianapolis, IN

19.4%

21.4%

$4,000

$4,100

San Jose, CA

38.8%

63.6%

$41,000

$101,000

Austin, TX

21.5%

19.8%

$6,000

$6,000

About Zillow
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SOURCE Zillow

For further information: Alex Lacter, Zillow, press@zillow.com