One of the things that's still keeping the real estate market slow is the disconnect between buyers and sellers.
And the folks at Trulia have come up with a great new tool to measure this: Search By Price Reduction.
Price reductions are all too commonplace in today's market.
Many sellers still have unrealistic expectations about the values of their homes. Or many are in denial about how far the market has fallen.
Many buyers, meanwhile, are afraid the market could still go significantly lower. They don't want to be the "sucker" who paid too much for a property while it was still going down. So if they do make an offer, many times it's much lower than the asking price.
This disconnect makes it hard to get deals done.
Trulia's new tool tracks these price reductions. They have found that 25% of homes on the market had at least one price reduction. And in the country's three heavyweight real estate markets -- New York, Los Angeles and San Francisco -- the average price reduction was 13-14%.
That's the average.
We asked Trulia to break things down even further for the readers of TerraFirmaLA and they did:
LOS ANGELES AREA PRICE REDUCTIONS*
| Location | Listings With Price Reductions | Average Listing Price | Average Reduction | Average Reduction Off Original Price |
| Beverly Hills | 28% | $3,900,983 | $680,725 | 15% |
| Los Angeles | 33% | $1,054,715 | $143,135 | 13% |
| Manhattan Beach | 25% | $2,107,261 | $240,468 | 10% |
| Burbank | 28% | $619,838 | $69,200 | 10% |
| Santa Monica | 28% | $1,499,881 | $147,219 | 9% |
| Pasadena | 31% | $1,053,590 | $101,712 | 9% |
| Culver City | 29% | $625,900 | $56,486 | 8% |
SOURCE: Trulia.com
And of course that average reduction off original price -- 13% citywide -- is just the asking price. With almost nobody but nobody offering asking price these days, I'd guess most properties are selling upwards of 20% below seller's original expectations -- or more.
That's a big gap between buyers and sellers.
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