PROVO, Utah (ABC4) – Sellers in Utah are dropping asking prices for homes.
A report from Redfin suggests “rapidly rising mortgage rates” and a drop in “home buying sentiment” are factors. So, too, is the “outsized price growth during the pandemic,” according to the report.
“Nearly half (47.8%) of homes for sale in Provo, UT – located about 45 miles away from Salt Lake City – had a price drop in May, the highest share of the 108 metropolitan divisions in this analysis,” the report reads.
Homeowner James Coleman says he’s surprised that his Provo home hasn’t sold yet.
“Our price range right now is fantastic, you would think it would sell instantaneously,” said Coleman, whose home has been on the market for a couple of months.
He’s had showings and some offers, and he’s consistently dropped the asking price.
“They’re not real strong offers, which has been shocking to us,” said Coleman.
Realtor Esther Clarke says the market is slowing — normalizing — and that’s caused some buyers to pause.
“We’ve gone from looking at homes with beautiful white kitchens and great backyards to looking at homes that are much less quality,” said Clarke.
“When their bank called them and said hey, by the way, now you qualify for 490 instead of 650, they had to really re-adjust their priorities. So I think everybody’s taking a pause,” added Clarke.
As the rapid spike in home prices levels off, she says prospective buyers will now have more time to make a decision.
“We should all be grateful for what is happening right now because as much as it feels uncomfortable based on the short-term memory of what we’ve seen in the last two years, this is actually a huge improvement for our market. It takes a lot of the stress out, but more importantly, it gives the buyers a chance to do their due diligence. Buyers have been waiving so many rights just to get the house, if we could slow down just a little bit, then those buyers can then go back to the home warranties and back to the home inspections and all the pieces that keep them safe as consumers,” said Clarke.