After years of a frenzied housing market, in which the majority of properties were receiving multiple offers and many properties were selling for over their listing price, 41.9% of sellers offered concessions to their buyers in the last quarter of 2022.
According to Redfin, this is the highest percentage in more than two years, when records began. This percentage is up nearly 12% from both the third quarter and year over year. It’s an increase of more than 1% from the previous high in the second quarter of 2020. The site defined a concession as when a seller offers something that lowers the cost of the buyers’ expenses when buying the property, like paying for repairs or assisting with closing costs.
Eleven percent of homes sold in the last quarter had a concession, a listing price cut and a final sale price below the original listing price, while 19% had a concession and listing price drop. Nearly one-quarter (22%) had a concession and a final sale lower than the listing price.
Despite the national trend of increasing concessions, Philadelphia actually reported a drop in concessions between the fourth quarter of 2021 and 2022. Concessions reported fell from 24.7% to 22%. This was one of the lowest among big cities across the city. Comparatively, 73% of sellers gave concessions in San Diego and 63% of sellers did in Phoenix.
Redfin also found that homes in December were lasting longer on the market. Homes were on the market on average 40 days, the longest amount in nearly two years. However, this is still shorter than historic averages.