If you are a buyer in Los Angeles, then you are in the driver’s seat. According to a report compiled by ZipRealty, Los Angeles is at the top of the list of cities with the biggest housing inventories. [1]

Here is a list of the 10 U.S. cities with the highest housing inventories as of September 2007 and the percentage of homes currently listed on the market whose listing price has been reduced as of Sept. 30.

Top 10 Cities With Highest Housing Inventories City # of Homes for Sale % of homes with price reductions

•  Los Angeles: 111,269               45.9
• Chicago:           82,839              40.8
• Miami:              79,154              38.1
• Tampa:             58,601              42.3
• Phoenix:           54,536              47.1
• Washington:     52,854              46.8
• Dallas:              47,097              35.9
• Boston:             43,158              48.4
• Sacramento:    40,195               51.4
• Houston:           39,332              36.7

What this means to you is that you have many more choices and you have more flexibility to negotiate terms with home sellers. As long as you are pre-approved for a loan and have your financial house in order, you, through your agent, are free to submit offers on homes that fit your criteria and loan approval level.

Keep in mind, however, that home sellers, in many cases, are not desperate and you may negotiate yourself out of a sale. As long as you are reasonable and are working with a knowledgeable real estate agent you should be able to find your dream home for a good price.

If you are a seller, make sure you are being realistic with your asking price. Work with your agent and make sure you are informed as to what the comparables in the area have sold for and what current comparables are priced at. I would also recommend that you have a home inspection before you get an offer so you know what repairs or issues may come up. An unexpected major repair surprise in the middle of escrow is not fun for either the buyer or the seller.

As the seller you need to have a plan as to how you will handle repair issues and price reductions, before you you get an offer. The process of selling your home can be emotional and addressing these concerns ahead of time helps eliminate some of the emotional component and stress that comes with it. Because there are many homes on the market right now, proper pricing is the number one reason that homes are selling. Second is presentation. If a home in the same neighborhood with the same square footage has nicer landscaping and looks better inside, buyers will probably consider that home first. Your agent should be able to advise you on what improvements or staging ideas to implement before you put your home for sale. Lastly, the market value of your home is whatever buyers are willing to pay for it. Know going into the process of selling your home what your time frame is and how much money you need to get out of the sale.

If you don’t have to sell your home and are not willing to negotiate, waiting may be the best course of action for you.