Redfin has reported that, in the month of May, 70.4% of home offers written by Redfin agents faced competition, down from a revised rate of 73.6% in April. That total is still up significantly from 52.7% as reported by Redfin in May of 2020, which was impacted by pandemic stay-at-home orders. An offer is considered part of a bidding war if an agent noted that at least one competing bid was submitted.
"After months of surging prices and low inventory, some house hunters are moving to the sidelines—either because they're priced out or burned out," said Redfin Chief Economist Daryl Fairweather. "Americans are spending more of their money on things like travel and dining out now that pandemic restrictions are being lifted."
Record-low rates hovering in the 3% range are luring some prospective buyers to the market, but many are being forced to the outside looking in, as record-high listing prices and the aforementioned bidding wars are proving too insurmountable to many. Redfin recently examined 400+ U.S. metro areas for the four-week period ending June 6, and during that time, the median home-sale price increased 24% year-over-year to $358,749, a record high for this metric. Asking prices of newly-listed homes also hit a new all-time high of $364,725, up 14% from the same time a year ago.
Of the 50 U.S. metropolitan areas included in the analysis, Spokane, Washington had the highest bidding-war rate with 86.7% of offers written by Redfin agents facing competition in May. Next came Raleigh, North Carolina at 84.5%, and Tucson, Arizona at 81.8%. Salt Lake City and Charleston, South Carolina rounded out the top five, with bidding-war rates of 81.5% and 79.3%, respectively.
"Competition is still high, but the good news is buyers are having to make fewer offers to win bidding wars," said John Copeland, a Redfin Real Estate Agent in San Diego. "A few months ago, buyers were bidding on three to five homes before winning. Now it's more like one to two. Part of that is buyers grasping the reality of the market; they've become more educated about what they need to do to win, so they no longer need to make as many offers."
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