In 2025, the dynamics of the housing market shifted significantly, as over 60% of homebuyers purchased properties below the asking price, according to data from Redfin. This development marks a notable turnaround from the intense bidding wars seen in previous years. The average discount for homes sold below their listed prices was 7.9%, the largest markdown recorded since 2012. For instance, on a median list price of $399,000, this equated to approximately $31,592—an amount sufficient for a down payment on a smaller property or upgrades to a new home.
Several factors contributed to this trend, including high interest rates, escalating insurance costs, and a surplus of home sellers compared to buyers. For example, West Palm Beach, Florida, saw discounts exceeding 10%, while markets in the Midwest, such as Detroit and Pittsburgh, experienced similar near or above double-digit markdowns.
Current market conditions feature nearly 47% more home sellers than buyers, offering significant negotiation opportunities. Buyers in 2026 are encouraged not to overlook properties priced slightly above their budgets, as numerous concessions from sellers are widely anticipated.
The condo market has exhibited particularly pronounced discounts, with nearly 70% of buyers purchasing below asking prices. Nonetheless, the market remains distinct from the post-2008 housing crisis, as today’s affordability issues stem from rising home prices rather than widespread foreclosures.
Experts suggest monitoring cities projected to see price drops, primarily in the Southeast and West, while overall national trends indicate modest increases in other urban areas.
Why this story matters
- The shift to more negotiable home prices can impact buyer confidence and market stability.
Key takeaway
- Buyers now have increased negotiating power, with many homes selling below their listing prices.
Opposing viewpoint
- Some analysts caution that despite discounts, home prices are still high relative to income, potentially limiting affordability for many buyers.
