30% of U.S. Housing Inventory Sees Price Drops, Says Compass CEO Robert Reffkin

The U.S. housing market is experiencing a notable shift, tilting in favor of buyers increasingly pushing back against the high home prices that sellers demand. This change is underlined by Compass cofounder and CEO Robert Reffkin, who shared his insights during a recent interview with CNBC.

Market Dynamics

According to Reffkin, 30% of the inventory on the market has seen a price drop, marking the highest percentage in the last decade. Additionally, the market has witnessed a 16% increase in inventory, indicating a growing supply of homes available for purchase. “It is a different environment. We are now seeing more sellers than buyers,” Reffkin noted.

Regional Variations

Reffkin pointed out that the Southern U.S. has experienced more price cuts, a region that previously saw steep increases as Americans migrated from more expensive states during the pandemic. This trend suggests a regional variation in how the market is adjusting to the new dynamics.

“Sellers bringing their homes on the market during this period need to be aware of how buyers are pushing back,” Reffkin said. “If your home is well priced in this environment, it will sell quickly. But if it’s not, it will sit on the market. Then you’re going to have to have a price drop. Then buyers will see they get a price drop. The sharks come out, and it will hurt you even more.”

Impact on Florida’s Housing Market

Florida’s housing market, in particular, has been significantly impacted by a spike in home insurance costs. Reffkin explained that these costs have soared by 40% year over year, putting additional pressure on asking prices. This increase in insurance costs is contributing to the overall shift in the market, making it more challenging for sellers to maintain high prices, according to AOL.

The current state of the U.S. housing market presents a unique opportunity for buyers, as increased inventory and price drops create a more favorable environment. However, regional variations and rising insurance costs, particularly in Florida, add complexity to the market dynamics. As Reffkin emphasized, “Sellers bringing their homes on the market during this period need to be aware of how buyers are pushing back”.

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