Price Reductions: What does this mean?

[Kevin Phu]

I'm just starting my research about the Huntsville and surrounding areas. I've just been looking through the active listings on Realtor.com and I've noticed that a lot of the listings that have price reductions are reducing their prices by ~10% after 1-2 weeks on market. To me, that seems fairly quick to drop your price. What would you say this indicates? Are sellers getting nervous that properties aren't being valued at what they think it should anymore and quickly dropping to get a sale? Are the amount of strong offers shortly after listing decreasing? Are sellers getting desperate for a sale due to COVID? What's your take on how to interpret this "trend"?

[Michael S.]

None of the above. . .the market here is crazy hot.  Those starting prices are similar to Zillow's "make me move" price listing.  They are shooting for above market value to see if someone is desperate enough to pay it with how tight inventory is here - if no takers after 1 to 2 weeks, they are then dropping their asking price to more realistic "fair market" values.