America’s vacant homes are not only selling for less money, but they are also spending more time on the market, according to a recent analysis from Redfin.
The average vacant home sells for $11,306 less and spends six more days on the market than comparable occupied homes, revealed the analysis, which compared the sale prices and time spent on the market of home listings marked as vacant with those marked non-vacant.
According to the report’s findings, less than 3% of homes included in the analysis started out occupied and became vacant while on the market.
“Although vacant homes are easy for buyers to tour at their convenience, the fact that the sellers have already moved on is often a signal to buyers that they can take their time making an offer,” Redfin Chief Economist Daryl Fairweather said. “It’s also likely that sellers who are in a comfortable enough financial situation to own a property that’s sitting empty aren’t as motivated to get the highest possible price for their home as sellers who need the cash from their first home in order to buy the next one.”
Although Redfin determined that vacant homes sell for less money in every housing market included in its analysis, the company revealed the amount varies by location.
In fact, Redfin discovered that vacant homes come with the biggest discount in relatively affordable inland areas. Additionally, while the price differential is smaller in expensive West Coast markets, vacant homes are still selling for less.
“In both Omaha, Nebraska and Greenville, South Carolina, where vacant homes are associated with the biggest discount, vacant homes sell for 7.2%, or about $15,000, less on average than occupied homes,” Redfin writes. “Next comes El Paso, Texas, where the average vacant home sells for 6.6% – about $10,000 – less than comparable occupied homes.”
However, Redfin highlights that in San Jose’s housing market, buyers get the smallest discount on vacant homes. According to the company’s data, San Jose buyers save about 0.9% when purchasing a vacant home instead of an occupied one.
“When the Bay Area real estate market is ultra-competitive like it was in 2018, vacant homes tend to sell faster than the ones occupied by their owners or tenants,” Redfin Agent Chad Eng said. “Vacant homes are accessible 24/7, which means homebuyers can see them and put in an offer quickly in hopes of beating out other potential buyers.”
NOTE: Redfin utilized linear regression to predict the sale price of homes sold in 2018 for each housing market the company tracks. Redfin reviewed local MLS commentary in order to determine whether or not a home was listed as vacant or occupied.