54% of Redfin Home Offers Faced Bidding Wars in November
Competition dipped slightly ahead of the holidays, but remained above 50% for the seventh-straight month amid record-low mortgage rates and relocations
SEATTLE, Dec. 16, 2020 /PRNewswire/ -- (NASDAQ: RDFN) — 53.6% of home offers written by Redfin agents nationwide faced competition in November, according to a new report from Redfin (www.redfin.com), the technology-powered real estate brokerage. While that's down from a revised rate of 58.5% in October, it represents the seventh-straight month in which more than half of Redfin offers encountered bidding wars.
U.S. homebuyers have been grappling with fierce competition this year due to historically low mortgage interest rates, an acute housing shortage and a sudden wave of migration made possible by remote work during the coronavirus pandemic.
San Diego Was the Most Competitive Market; Minneapolis Was the Least Competitive
The San Diego metro area had the highest bidding-war rate of the 24 metros in this analysis, with 75.3% of Redfin offers facing competition. It was followed by Denver (66.7%), San Francisco/San Jose (65.8%) and Seattle (60.9%). Sacramento—the most popular destination for people looking to move to a different metro area—rounded out the top five, at 60.0%.
Justin Hess, a Redfin real estate agent in the Denver area, recently received 22 offers for a three-bedroom single-family home he listed in Thornton, CO, a Denver suburb. The winning bidder ended up paying $35,000 over the $410,000 asking price and waiving their appraisal contingency.
"Single-family homes that are priced right, in good condition and in a desirable neighborhood are still selling quickly for top dollar," Hess said. "If you're a buyer, you had better bring your best punch and expect competition. People are paying a premium for the latest and greatest, updated, remodeled, turnkey homes."
Some of the places with the highest bidding-war rates have also seen significant growth in new listings—one factor that's allowing competition to flourish, according to Redfin Chief Economist Daryl Fairweather.
"Buyers aren't going to compete for homes that have been sitting on the market," Fairweather said. "They will typically only get into a bidding war for a newly-listed, desirable home that is move-in ready."
In San Diego, for example, new listings were up 13% year over year in November, outpacing 5% growth in Minneapolis.
Minneapolis had a lower rate of competition than any other metro area in this analysis, with 34.6% of Redfin offers facing bidding wars in November. Also in the bottom five were Chicago (36.4%), Tampa, FL (37.1%), Houston (37.3%) and New York (37.6%).
Condos Were the Least Likely to Face Bidding Wars
Condos were the least likely to encounter competition in November, with 38.3% of Redfin offers facing bidding wars. That compares with 48.7% of offers for townhouses and 57.3% of offers for single-family homes.
The condo market has experienced relatively sluggish growth as remote work and a shift in homebuyer preferences due to the pandemic have made single-family homes more sought after.
Bidding-War Rates By Metro Area, November 2020 and October 2020
Metro Area | Share of Redfin offers that | Share of Redfin offers that |
San Diego, CA | 75.3% | 75.9% |
Denver, CO | 66.7% | 54.3% |
San Francisco / San Jose, CA | 65.8% | 71.9% |
Seattle, WA | 60.9% | 61.9% |
Sacramento, CA | 60.0% | 61.2% |
Los Angeles, CA | 59.5% | 62.5% |
Washington, D.C. | 58.7% | 66.6% |
Austin, TX | 58.1% | 67.7% |
Phoenix, AZ | 57.7% | 54.1% |
Salt Lake City, UT | 56.0% | 77.6% |
Philadelphia, PA | 52.3% | 64.4% |
Portland, OR | 50.8% | 61.3% |
Detroit, MI | 50.0% | 50.0% |
Boston, MA | 47.6% | 55.7% |
Raleigh, NC | 46.8% | 46.9% |
Miami, FL | 45.4% | 42.1% |
Dallas, TX | 42.0% | 52.7% |
Las Vegas, NV | 41.3% | 38.2% |
Atlanta, GA | 37.8% | 52.4% |
New York, NY | 37.6% | 50.7% |
Houston, TX | 37.3% | 46.2% |
Tampa, FL | 37.1% | 53.5% |
Chicago, IL | 36.4% | 41.7% |
Minneapolis, MN | 34.6% | 59.4% |
To read the full report, including additional Redfin agent insights, please visit: https://www.redfin.com/news/real-estate-bidding-wars-november-2020.
About Redfin
Redfin (www.redfin.com) is a technology-powered residential real estate company, redefining real estate in the consumer's favor in a commission-driven industry. We do this by integrating every step of the home buying and selling process and pairing our own agents with our own technology, creating a service that is faster, better and costs less. We offer brokerage, iBuying, mortgage, and title services, and we also run the country's #1 real estate brokerage search site, offering a host of online tools to consumers, including the Redfin Estimate. We represent people buying and selling homes in over 90 markets in the United States and Canada. Since our launch in 2006, we have saved our customers over $800 million and we've helped them buy or sell more than 235,000 homes worth more than $115 billion.
For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the Redfin Data Center. To be added to Redfin's press release distribution list, email [email protected]. To view Redfin's press center, click here.
SOURCE Redfin
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