Suspension Of Price Discovery Feels Like Waiting For The Floor To Dry

June 30, 2025
  • US Listing Inventory Has Popped In The Past Three Weeks
  • When Every Listing Is Not Generating Interest, It’s Not The Price
  • Sometimes Lowering A Listing Price Won’t Move It Faster

When a property listing fails to generate interest in its first several weeks, the agent may think the price is too high and consider lowering it. If other houses in the competing area are receiving offers, it’s a good bet that the listing price is too high. But what if none of the houses in the competing area are receiving any offers? The impulse to drop the price right away might be a mistake. I’ve seen markets temporarily stall in the past where dropping the price made no difference.

A Seller Starts To Panic

As you know, I am trying to sell my apartment.  The market is a mess.  My wife and I have to make a decision as to whether to cut the price pretty dramatically or to sublet and hope the market recovers in a couple years.  I’d like to know what’s in your crystal ball.

Someone I know who just reached out to me.

My Response To The Seller

Over the past 3 weeks, the market has paused across all the US markets I cover. The uncertainty is significant, and I’m not sure it’s about the price. I’m getting feedback like yours from many people I know. It might just require waiting and being patient.

What Is Price Discovery?

Price discovery is the process through which buyers and sellers interact to agree on a price for a home. It is a product of the available information, the number of buyers and sellers interacting, and the existence of external events that can affect the price direction. Sometimes, when there is a significant disruption, everyone in the arena takes a break to assess the current market and then eventually steps back into it. I believe the political chaos of the past month has made June a pivotal moment in time. Nearly every market I follow has seen inventory levels rise and contract signings ease over the past three weeks. With the sudden pullback in demand, there is very little price discovery occurring.

Uncertain Final Thoughts

Just as our trade war with Canada seemed to de-escalate, it re-escalated [gift link] out of nowhere. That’s the rub in all of this economic uncertainty. The randomness of US economic policy has shown there is no actual strategy behind it, so companies and individuals can’t plan for the future. Beginning in April, with the still-ongoing Tariff Tantrums, a potential wider-scale war in the Middle East, and a massive addition to our national debt for no apparent reason, the economics of uncertainty may hit housing hard. We have officially entered “The Rein of Error.”

The Actual Final Thought – Sometimes you just have to wait for the floor to dry.

Monday Mailboxes, Etc. – Sharing reader feedback on Housing Notes.

June 27, 2025: The Rein of Error: Tariffs On Canada Brought A Sudden Drop To NYC and Florida Tourism

  • As a die-hard Rush fan, I’m glad to see Strange Brew mentioned in relation to housing. Palm Springs is another place feeling the effects of the tariffs. ‘The atmosphere in town is one of anxiety’: Palm Springs is in trouble
  • I trust that it will read well for my UK based clientele!  have a great weekend. 
  • Trenchant insight into the Canadian culture, sad but true. I, too, have Canadian roots dating back generations, and found a kindred cousin on LinkedIn with whom I share a last name who said it’s a fairly common name in Montreal.
  • Great article! I am Canadian, although was brought up in the UK. I am actually trying to get my 2 year old Canadian nationality…which they are trying to make more complicated when the Canadian parent was born outside of Canada. Anyway, just wanted to say I always enjoy your emails!

June 26, 2025: The NYC Housing Affordability Crisis Is Not Understood By Its Voters

  • I must say….ALWAYS something valuable in every one of your posts!!! Thank you and I hope that you are well !!  Happy Summer!

Did you miss the previous Housing Notes?

June 27, 2025

The Rein of Error: Tariffs On Canada Brought A Sudden Drop To NYC and Florida Tourism

Image: Wikipedia

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