The slowing demand for homes is affecting the balance of power between buyers and sellers, according to two new reports from Redfin.
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More homesellers are dropping prices as bidding wars become less vicious, the latest signs that an ongoing decline in home demand is beginning to wrest the balance of power back from sellers.
Home offers written by Redfin agents faced competition 58 percent of the time in May, down from 61 percent the month before, according to a new report Friday from the Seattle-based national real estate company.
The report marks the fourth consecutive month of competition in decline. It caps off a year of easing that peaked at 69 percent competition rates in May of 2021.
By the end of the year, fewer than half of Redfin homes are expected to be in a bidding war, the company’s economists expect.
Source: Redfin
“The housing market isn’t crashing, but it is experiencing a hangover as it comes down from an unsustainable high,” Redfin deputy chief economist Taylor Marr said in a separate report released Thursday. “Housing demand has already cooled significantly to the point that the industry has begun facing layoffs.”
Redfin announced on Tuesday it was laying off 8 percent of its employees due to a nationwide decline in home sales. Compass announced a 10 percent reduction in full-time staff on the same day.
Meanwhile, homebuilders have been cutting back on the number of new construction projects they’ve begun in recent months, citing the same market conditions.