In a new analysis of home sales, Zillow has found that home buyers looking for a Black Friday deal may want to shop on Thursdays, as that’s the day of the week when sellers are most likely to slash their list price. This fall, a record 28% of sellers had cut their list price, meaning bargain hunters who can afford today's mortgage rates are more likely to snag a discount.
And when home sellers did slash their asking price, 18.5% of them did so on a Thursday.
However, the timing can be slightly different depending on the metro area. For instance, in Philadelphia and Baltimore, price cuts most often occurred on a Tuesday, while Monday was the best day for deals in Detroit, Cleveland, and Buffalo.
Buyers nationwide witnessed fewer price cuts on Fridays and the weekends when sellers were busy with showings and open houses.
Zillow found that the best time of year for bargains typically runs from the beginning of July through the middle of September. These are often discounts on homes that didn't find a buyer during the spring and summer home shopping seasons.
"Fall and early-winter sellers likely understand the market is slower during the colder months and may have built that into their pricing strategy, resulting in fewer price cuts," said Zillow Senior Economist Orphe Divounguy. "This year may be the exception. This fall, a record number of sellers have already adjusted their list price to keep up with the rapidly shifting market. The price they set just weeks ago may no longer be attainable in light of rising mortgage rates and falling demand."
Price drops have been modest, generally between 2.6% and 3.8% off the home's original listing price, adding up to approximately $11,000 off a typical U.S. home, but can be as much as $61,700 off the listing price in more expensive metros like San Jose, California. Zillow found that shoppers in the Buffalo, New York found the biggest bargains, where the typical price cut was 4.6%. Shoppers in Phoenix, meanwhile, are seeing the smallest reductions, with a typical price cut of just 2.5%.
If a seller is going to cut their home's price, it generally occurs three weeks after its initial listing. The exception was found to be in the winter when homes were typically listed for roughly seven weeks before sellers began to cut prices. Price reductions are now happening sooner than they used to prior to the pandemic when listings would typically linger for four weeks before a reduction.
"Buyers who are pre-approved for a mortgage at today's rates will not only find more discounts, but they'll have a much better buying experience," added Divounguy. "They will have more time to make a decision and will be able to include contingencies in their offer, which could help them avoid a costly mistake. A home should be a long-term investment, and buyers today have a better opportunity to land the right home than they have had in several years."