'Under Valued' Homes Offer Up To 23% Off–Here's Where You Can Save The Most, According To Redfin

Buyers may be searching for bargains in today’s challenging housing market, marked by high home prices and interest rates.

A Realtor.com report issued Wednesday found that certain buzzwords in property listings can signal savings for potential homeowners.

Listings featuring phrases like “priced to sell,” “undervalued,” “underpriced,” or “bargain” aren’t just marketing fluff – these descriptions often translate to real discounts, averaging 8.5% off asking prices nationwide. 

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For a median-priced home, that’s nearly $38,000 in savings.

Ralph McLaughlin, senior economist at Realtor, said that the “value-based words” in listings correlate strongly with lower prices. However, the prevalence and impact of those listings vary widely across different markets.

According to the Redfin report, Little Rock, Arkansas, tops the list for bargain hunters. Homes labeled as “priced to sell” in this market average a 23% discount. That translates to a median savings of $57,494 – a substantial sum for most buyers.

St. Louis, Missouri and Charleston, South Carolina round out the top three, offering discounts of 18.7% and 15.9% respectively. Other Midwestern and Southern cities dominate the list of markets with the steepest “priced to sell” discounts.

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Interestingly, the frequency of those listings in a market doesn’t always correlate with bigger savings. The opposite often holds. Markets flooded with “bargain” listings tend to offer smaller discounts.

McLaughlin explained the seemingly counterintuitive trend: “Metros with a higher share of ‘priced-to-sell’ homes on the market tend to have smaller discounts compared to metros with a lower share, likely reflecting the need of sellers to offer a discount when other ‘priced-to-sell’ homes are rare.”

For example, in Sarasota, Florida, where 6.7% of listings use the value-signaling terms, the average discount is just 4.4%. Contrast that with Long Island, New York, where only 1.9% of listings use such language, but those homes come with an average 12.5% price cut.

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That pattern suggests that the scarcity of “bargain” listings in a market may actually increase their impact. When buyers rarely encounter such properties, they may expect – and receive – steeper discounts.

The geographical spread of the discounts is notable. Southern and Midwestern markets generally offer the biggest savings on “priced to sell” homes. Meanwhile, Florida and Western markets tend to have the smallest discounts, despite often having a higher percentage of listings using bargain-oriented language.

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For instance, Orlando, Florida offers just a 3.2% discount on properties with the language, while Seattle, Washington and Salt Lake City, Utah follow closely behind with discounts of 3.7% and 3.8% respectively.

For those willing to do their homework, homes advertised as undervalued or bargain-priced could offer a pathway to homeownership at a discount – especially in markets where those listings are rare.

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