Want to Save Big on a Home Purchase? Look for This Phrase in the Listing
Just three little words in the description of a home listing can signal a steep discount worth tens of thousands of dollars.
For-sale listings with the phrase “priced to sell” come with an average discount of 8.5%, according to an analysis from Realtor.com released Wednesday. That translates to a reduction of about $38,000 from the median price of a home.
“We’ve found that certain ‘value’-based words used in listing descriptions are correlated with lower listing prices — and can be used to help homebuyers find true bargain properties,” wrote Ralph McLaughlin, the site’s senior economist, in the report.
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View RatesThe phrase "priced to sell" is real estate jargon to indicate the house is (or should be) a good deal. In some cases, it could be code for "this place is a fixer-upper and needs some TLC."
Overall, the analysis found that this kind of value-based wording — which also includes “bargain,” “under valued” and similar key phrases — translated into statistically meaningful discounts on home prices in 38 out of the largest 100 metro areas.
Given that mortgage rates are well above 6%, knocking such a large chunk off the home price could provide welcome reprieve for some buyers.
Where ‘priced to sell’ homes have the biggest discounts
Regional factors are certainly at play. The discounts on priced-to-sell houses identified by Realtor.com ranged from 3.2% to 23.1%.
The largest discounts associated with the priced-to-sell phrasing were usually in cities across the South and Midwest (though some Southern areas — notably in Florida — actually had some of the smallest discounts).
Discount %
Median listing price
Discount on median price
Little Rock, Arkansas
23%
$249,900
$57,494
St. Louis, Missouri
18.7%
$264,900
$49,476
Charleston, South Carolina
15.9%
$499,999
$79,558
Memphis, Tennessee
14.5%
$299,000
$43,262
Lake County, Illinois
12.6%
$399,900
$50,464
Nassau County, New York
12.5%
$759,000
$94,662
Cambridge, Massachusetts
11.5%
$779,000
$89,851
Tulsa, Oklahoma
11.4%
$287,500
$32,801
El Paso, Texas
11.2%
$279,000
$31,295
Witchita, Kansas
10.9%
$262,000
$28,655
Source: Realtor.com
On the flip side, the Orlando area had the smallest discount of the metros included in the analysis. Still, looking for “priced to sell” in a listing there could save you 3.2%, or about $13,500 off the typical home.
One caveat that McLaughin mentioned is that if you're searching for a house in an area that is inundated with "priced to sell" listings, then you might not be getting much of a discount. The best discounts are in areas where the phrase doesn't appear in every other listing simply as a marketing gimmick. In that case, it pretty much becomes meaningless.
"To put it more simply, if a lot of listings were priced to sell," he wrote, "then buyers might not expect a discount or might not be able to tease out whether those listings are actually priced to sell."
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