Buyer competition has shown some signs of easing, however two Fla. metro areas – Tampa and Orlando – remain two of the top 15 U.S. metros for bidding wars.
SEATTLE – Housing market competition may show some signs of easing, as more markets report price cuts and fewer bidding wars. That may open the door to some buyers previously priced-out of the market to find success this fall.
In July, 60% of offers written by real estate professionals nationwide faced competition, but that’s the lowest level since January, according to an index that measures competing offers among Redfin real estate professionals. The bidding war rate is also significantly down from a pandemic peak of 74% in April. An offer is considered part of a bidding war if at least one competing offer is made.
“Competition has started to slow in the last three weeks,” says Scott Mercer, a real estate professional with Redfin in Sacramento, Calif. “We’re now seeing five to eight offers on homes instead of 25, and they’re coming in $5,000 to $10,000 above the listing price instead of $50,000 to $60,000. Buyers are pushing back. They’ve even started including appraisal contingencies again and making requests for repairs – things that were pretty much unheard of last year.”
Are sellers getting too greedy with list prices?
With more listings coming onto the market, buyers have more homes to choose from, which reduces competition. Also, housing competition typically eases in the summer following the spring homebuying season.
However, nothing about the pandemic-era housing market has strictly followed historical seasonal patterns.
Home prices remain high, which may price out some potential buyers, too. The National Association of Realtors® (NAR) reports that the median existing-home price for all housing types in June was $363,300, up 23.4% compared to a year earlier.
The markets with the largest share of bidding wars in July, according to Redfin’s index, were:
- Fort Collins, Colo.: 77.3%
- Orlando, Fla.: 77%
- Nashville, Tenn.: 74.6%
- Honolulu: 74.1%
- Colorado Springs, Colo.: 73.2%
- Sacramento, Calif.: 72.9%
- Charleston, S.C.: 71.4%
- Charlotte, N.C.: 70.8%
- San Diego: 69.8%
- Las Vegas: 68.6%
- Tucson, Ariz.: 68.4%
- Tampa, Fla.: 66.7%
- Denver: 66.5%
- San Francisco/San Jose: 66.3%
- San Antonio: 66.3%
Source: “Homebuyer Bidding War Rate Drops to Lowest Level Since January,” Redfin (Aug. 16, 2021)
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