Region's home sellers holding firm, Web site says

If you've been waiting for home prices to bottom out before you buy, the wait may be a long one.

According to data released today by Trulia, a real estate search engine based in San Francisco, sellers of only 25 percent of existing homes on its Web site in the eight-county Philadelphia region have cut list prices - and then by an average of only 8 percent.

Philadelphia ranks 32d on Trulia's list of 50 U.S. metro areas in the percentage of houses whose prices have been reduced.

Nationwide, Trulia says, prices have been reduced on 24 percent of homes for sale, with the average drop 11 percent. Its data are based on "live" listings as of June 1.

Translated into whole numbers, a house first listed at $299,835, the average for the Philadelphia area, dropped in price by $23,217, to $276,618.

"I think [Trulia's percentage] is very accurate," said broker John S. Duffy Sr., owner of Duffy Real Estate on the Main Line, whose own measure of his coverage area last month showed a price reduction of 6 percent for 25 percent of the listings.

Slowly, but definitely, Duffy said, there has been a sea change in seller attitude toward pricing, "at least within the last six to eight months."

"We tell them we'll have to build a defense for the price and the house," he said. In today's buyers' market, "everyone who walks through the door believes the house is overpriced. It's up to the agent to prove it is not."

David Krieger, general manager at Coldwell Banker Preferred, said he thought the percentage of listings with price reductions was closer to 50 percent or 60 percent.

"I would think that probably 80 percent of homes that don't sell within the first 30 days will eventually have a price cut," he said.

The houses that Weichert Realtors agent Diane Williams is showing in eastern Montgomery County "seem to have a high percentage of price changes," she said. She, too, believes Trulia's percentage is low.

"I have 12 listings, and five of them have had price 'improvements,' " with three of those houses having more than one reduction, she said. On Wednesday, one price was reduced $73,000, from $650,000 to $577,000.

Center City agent George Cahill of Coldwell Banker Real Estate Corp. said the dearth of comparables these days had made pricing difficult.

"Many agents are pricing listings with a 'test-the-market' approach," he said. "Then, after a period of time, we revisit the original pricing and adjust down, if needed, based on the activity the pricing is generating."

Further complicating pricing is the spike in mortgage interest rates, which rose almost half a percentage point in the last few weeks, to 5.29 percent yesterday, Freddie Mac reported.

In the local condo market, especially Center City, there is roughly a two-year supply of new units for sale, which prompted still other agents and brokers to say Trulia's percentage of listings with price reductions is too low.

Prudential Fox & Roach agent Jeff Block said it was more like 50 percent in Center City and University City.

Noted Mark Wade, also of Prudential Fox & Roach: "The most heavily populated segment of the daily activity sheets in the Multiple Listing Service for Center City is price reductions," regularly outnumbering new listings, settled properties, and pending properties.

But Wade added that the amount prices were reduced in this region - just 8 percent - got back to the notion that "Philadelphia has not seen wild escalating prices over time," and that less downward adjustment is needed here compared with other metro areas.

Trulia says 23 percent of all Center City condos for sale had list-price cuts, which averaged 9 percent. The same percentage of single-family houses had list-price cuts, averaging 7 percent.

Regionwide, Trulia reports, houses first listed at $500,000 were reduced in price by 8 percent, houses between $500,000 and $1 million had 7 percent price cuts, and $1-million-plus list prices were cut 11 percent.

"The key here is the pricing of the unit from the start," Center City broker-developer Allan Domb said. "If a property sold for $450,000 last year, it might be worth $390,000 to $400,000. That is reality."