People Are Confused—If Houses Aren't Selling, Why Aren't Prices Dropping? 'That's Insane,' One Buyer Says

A growing number of homebuyers are scratching their heads. Despite homes sitting on the market for weeks or even months, prices remain sky high. 

In a recent post on r/RealEstate subreddit, one Reddit user summed it up like this: "In a lot of places, the home prices themselves have doubled since Covid… and when you factor in the interest rates, you're looking at paying three times as much money in the long run. That's insane. Why is this happening and if the houses are not selling, why are the prices not coming down to earth?"

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Sellers Aren't In A Hurry To Move

In many parts of the country, homeowners are still hoping to cash in on the pandemic housing boom—even if their expectations are outdated. As one commenter put it, “It seems like a lot of people are selling who bought in 2022-2023 so they paid a premium and they're trying to break even, including closing costs.”

The result is a standoff: overpriced listings that sit unsold while sellers wait for offers that never come. “People list a house for $100k more than they bought it for in 2022 after doing nothing to the house,” one person noted. “Then you watch the price reductions fall under what they paid for it at the top.”

Low Mortgage Rates Are Locking Sellers In

Many homeowners have mortgage rates under 4% and are reluctant to give that up for a new home with a 7% interest rate. “If I sold my own house to myself it would cost me like $100k,” one person wrote. Another added, “We won't be able to sell for MANY years because our house hasn't appreciated at all and rates are higher now.”

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Even those willing to move aren't necessarily desperate. “The sellers I know aren't greedy or delusional. They simply can't move if the price falls much further, so they are prepared to remain in the home for a long time,” one commenter explained.

What About Buyers?

Buyers, on the other hand, are exhausted. After touring dozens of homes with inflated prices and misleading listings, they're tuning out. “As an out-of-town buyer who has been to a million houses with dishonest photos, I put those houses that have been sitting forever with multiple price drops in my low-priority bucket,” one buyer said.

Some are just waiting for sellers to face reality. “Smart ones will get out while they still can before everything tanks,” another wrote.

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Why The Market Is So Stuck

According to several commenters, the market is paralyzed by unrealistic expectations. One agent said the homes sitting on the market are often not “priced aggressively” and “have some kind of deficiency that keeps them from meeting buyers’ expectations.”

Others point out that this situation is very different from 2008. “Qualified mortgage rules… have meant that homeowners in the last 15 years are significantly more stable and unlikely to default,” one person explained.

With many owners sitting on large equity cushions or renting their homes instead of selling, price drops are likely to be slow and uneven. As one poster put it: “Prices will always come down slower than they rose. It's a strange market, there's a lot of pent-up demand but there are too many factors working against people who want to buy.”

And if there is a broader price drop, it could take years. “The process will take 4-5 years, and it will likely become apparent suddenly rather than gradually,” one person predicted.

Many commenters agree: unless unemployment spikes or a serious recession hits, sellers can afford to hold out. “People are still hoping for dream prices… the houses that get to reasonable levels sell fast and the dream prices just sit.”

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