Price Reduced! But Is It Really a Good Deal?

Price Reduced! But Is It Really a Good Deal?

You’re scrolling through homes online and suddenly see those two magic words:

PRICE REDUCED!

It catches your attention, doesn’t it?

Maybe the home was $325,000 and now it’s $309,900.

That sounds like a bargain.

But here’s the important question:

Was the house actually worth $325,000 in the first place?

A price reduction tells us one thing:

The seller changed the asking price.

It does NOT automatically tell us whether the home is now a good deal.

And in today’s market, that distinction matters.

Price Reductions Are Pretty Common Right Now

In the latest detailed Tri-Cities numbers, more than 37% of homes that sold had experienced a price reduction before closing.

Buyers are also negotiating again. Nearly two-thirds of sales under $1 million included some type of concession.

So yes—there may be opportunities out there.

But we still have to determine whether a particular home represents good value.

Here’s What We Look At

When Karin and I help a buyer evaluate a home, we don’t simply compare the current asking price to the old asking price.

We look at things such as:

Recent comparable sales
What have similar homes nearby actually SOLD for?

Condition
Does the home need a roof, HVAC system, flooring, updates or major repairs?

Location
Two very similar homes can have different values because of neighborhood, lot, road, views or other factors.

Days on market
Has the home been listed for five days—or five months?

Previous price reductions
Was this one reasonable adjustment, or has the seller been chasing the market downward?

Competition
Are there several comparable homes available, or is this one of the few choices in its price range?

Here's a Simple Example

Imagine a home originally listed for $325,000.

The seller reduces it to $305,000.

Wow—a $20,000 reduction!

But suppose comparable homes have recently been selling around $295,000–$300,000.

That $305,000 asking price may be much more realistic than before...

…but it isn't necessarily a bargain.

Now imagine another home listed at $300,000 where the comparable sales support $310,000.

That home might actually represent the better value—even though it never had a flashy PRICE REDUCED! banner beside it.

Sometimes the Best Deal Isn’t the Cheapest House

That’s especially true when we consider everything else that can be negotiated.

A seller may be willing to contribute toward:

• Closing costs

• Repairs

• A rate buydown

• Other allowable concessions

Sometimes those items could be more valuable to you than another few thousand dollars off the purchase price.

This Is Where Knowing the Numbers Matters

One of my additional areas of training is Broker Price Opinion (BPO) valuation, which involves analyzing comparable properties and market data to form an opinion of a property's value.

That training is useful when we’re helping buyers answer a very basic question:

“Does this price make sense?”

No one can guarantee exactly what a home is worth, and an appraisal may still be required by your lender.

But we can absolutely do our homework before you decide what you're willing to offer.

Don't Shop for a Discount. Shop for VALUE.

A price reduction can certainly create an opportunity.

But instead of asking:

“How much did they knock off the price?”

Ask:

“What is this home actually worth in today’s market?”

That's the question that can help keep you from overpaying—and sometimes help you recognize a genuinely good opportunity when you find one.

If you're looking at a home and wondering whether the asking price makes sense, Karin and I are happy to help you look at the numbers.

No pressure. Just good information so you can make a good decision.

🎓 And if you're preparing to buy, our FREE Homebuyers Success Academy walks you through the entire process:

https://www.youtube.com/playlist?list=PLU-DcNzz_A94

Ed & Karin
At Home with Ed & Karin

With HEART and a bit of HUMOR, you will feel At Home with Ed & Karin.

Any valuation discussion is an estimate for informational and negotiation purposes and is not a licensed appraisal. Buyers should independently verify information important to their purchase.