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Redfin: Bidding Wars at 10-Year Low in November
Redfin, Seattle said 10 percent of offers written by Redfin agents on behalf of their homebuying customers saw a bidding war in November, down from 29% a year earlier and hovering at the 10-year low for the fifth consecutive month.
The report said San Francisco was the only market that remained somewhat competitive in November. The bidding war rate there was 30%, but down from 53% a year earlier and down from 34% in October. The month-over-month decline of 3.7 points was slightly below the 2010-2018 average October-to-November decline of 4.6 points.
Redfin Chief Economist Daryl Fairweather said the overall rate is likely to remain low through the end of the year, and begin rising again in early 2020. “Even though the number of homes for sale has been falling faster than we normally see this time of year, buyers just aren’t feeling any sense of urgency right now,” she said. “The supply and demand data still says that it’s a seller’s market, but homebuyers working with Redfin agents in places like Portland and Denver are feeling and acting like they’re in control. Most of the homes that they are seeing are simply not worth getting into a bidding war over, so they’re more than willing to wait until the new year in the hopes that more homes will hit the market.”
San Francisco Redfin agent Miriam Westberg cited several reasons for that market’s competitiveness. “Almost every home for sale that is in a great location and priced competitively is still receiving multiple offers,” she said. “One home we made an offer on last week had 25 other offers. However, homebuyers definitely feel like they can be more selective this year, so homes that don’t check every single box may only get a single offer, and tend to take a longer time to sell.”
The report said competition was scarce everywhere else in the country, with no other market seeing a bidding war rate higher than 17%. The bidding war rate hit its lowest point in at least five years in November in Chicago, Houston, Portland and Los Angeles.
Houston was the least competitive market in November, with just 1.4% of offers facing a bidding war. Miami was barely above that at 1.7% and Raleigh, N.C. followed with 2.6% of offers facing competition.
Fairweather noted 2019 as a whole has been a “welcome reprieve” from the frenzied market of years prior, but with fewer new listings hitting the market and more homes selling quickly after being listed, “2020 may be shaping up to swing the pendulum back in the other direction.”