Prices Up, Yet 7 in 10 Sellers Are Cutting: SLO Explained

By Hal Sweasey

Hal Sweasey is a highly respected Broker and REALTOR® serving California’s Central Coast, bringing more than 35 years and 3,300 successful property sales.

Welcome to our September market update for San Luis Obispo County. Some months we reiterate familiar themes, but this month there’s genuinely something new happening in the marketplace, so let’s dig into the numbers and then talk about what they mean for those of us buying and selling here locally.

Start with the year-over-year picture. Homes for sale are up about 7% from a year ago, which makes sense to anyone paying attention. Pending escrows are down about 3%, so not much change there, and closed sales are up about 1%. The number that stands out is new listings, up 12%, a pretty significant jump in the amount coming to market. On price, average closed sale prices are up a little over 9%, (and that’s closed sales, we don’t count active listings). Days on market have climbed 25%, to a little over 80 days for homes currently for sale, though homes that actually closed did so in about 54 days, and closed sales are usually what we watch most closely.

Over 70% of sellers cut their price. Here’s the headline, and it’s striking enough that the local Tribune called us about it. Of the 540 homes on the market over the course of last month, 394 of them reduced their price. That’s over 70%. We’d been seeing price reductions on maybe 40, 50, sometimes 60% of the inventory, but 70% in a single month is a real jump. It’s the sound of sellers who put their home on the market, didn’t get the result they wanted, and made the adjustment. After doing this a while, you can simply feel a shift like this in the marketplace.

How prices can be up while sellers are cutting. You’re probably asking the obvious question: if average prices are up around 9 or 10%, how can so many people be cutting their prices? Two things explain it. First, look back a year. In the first several months of last year, we had the “tariff tantrum”, the stock market dropped, uncertainty spiked, the market slowed, and prices dipped. So we’re partly measuring against a lower base from that dip, which then leveled off and began climbing again. That prices are a bit higher on average this year doesn’t surprise me at all. Second, and this matters, an average can be skewed when more higher-priced homes are selling, and we’re seeing exactly that.

As I like to say, statistics are right about half the time and wrong the other 90%. The point is that a rising average and widespread price cuts aren’t a contradiction, they’re two true things happening at once.

So what does all of this mean for you?

If you’re a seller, the good news is that you get to choose your outcome. Roughly a third of homes are selling each month, about 30%, and of those, more than 20% are still getting multiple offers. That happens when a home is genuinely well-priced and in good condition: buyers see the value and compete for it.

Price your home right, and in three or four weeks you can have a strong buyer, possibly several. Miss the mark, and you’ll be waiting, hoping, watching the showings not come, getting frustrated, and then likely making one, two, or three price adjustments until you finally land on the number buyers see value in. The market is changing, and that frustration is showing up for sellers who priced for a market that’s already moved.

If you’re a buyer, your job is to read the situation correctly. When a well-priced home in good condition hits the market, recognize that it’s not really the time to negotiate hard, it’s a good value, other people want it, and that competition is actually a good sign. On the other hand, if you liked a home but the price never felt fair, sometimes the smart move is to wait, because that seller may make an adjustment and you can step in later at a better number. That’s the game right now, and it’s exactly where good local advice earns its keep.

The bottom line, and this is my read: prices are softening a bit, inventory is up, but there still isn’t a lot for sale. So if you’re well-priced and you don’t have much competition for the specific kind of home you have, you’re going to get a very good result. It’s genuinely a case-by-case market now, which is exactly what we’re here to help you sort out.

If you have any questions about your home or your situation, call or text us at 805-781-3750, email us at hal@teamsweasey.com, or visit teamsweasey.com. We’ll look forward to talking with you.