Report shows competition in US housing market getting tighter
Bidding wars intensified in April, with roughly 72% of home offers facing competition, according to Redfin’s latest report.
The April bidding war rate was up from a revised rate of 66.7% in March and 44.9% in April 2020. However, Redfin noted that stay-at-home orders that temporarily halted home buying and selling during the pandemic had a significant impact on the April 2020 bidding war rate.
“In March, we were seeing three or four offers on a home. Now, we’re sometimes seeing more than 20,” said Kristin Lopez, a Redfin real estate agent in Boise, Idaho. “The homes for sale today are high-quality, desirable homes—a dynamic that’s fueling more competition. This is a contrast from the winter when most properties coming on the market were bottom-of-the-barrel homes. The difference is that today’s sellers are folks who want to sell, whereas many sellers back in the winter had to sell and didn’t have time to do any upgrades.”
Of the 45 metro areas in Redfin’s analysis, Salt Lake City had the highest bidding-war rate, with 83.5% of offers facing competition. San Diego and Spokane, Wash. tied in second at 83.5%, followed by Boise and Pheonix at 81.8% and 80.5%, respectively.
“Cash offers are on the rise in Boise, which means buyers without deep pockets are frequently getting outbid,” Lopez said. “Cash is on the rise in part because there are more investors in the market, but also because there are a lot of families moving here from more expensive parts of the country. Most buyers I work with are from out of state, and many of them have the cash to compete because they just sold their home in California or Seattle.”