Record Share of Homebuyers Make Sight-Unseen Offers
Redfin, Seattle, said nearly half (45%) of people who bought a home in the past year made an offer on a property that they hadn’t seen in person, the highest share since at least 2015.
The report said this compared to just 28% during the same period last year, and 20% in July 2015, when Redfin posed this question for the first time.
Redfin agents cited health concerns around the coronavirus pandemic, accelerating migration trends and competition fueled by a worsening housing shortage as reasons more buyers are bidding on homes before visiting them.
“Sight-unseen offers will likely continue to climb in the coming months,” said Redfin Chief Economist Daryl Fairweather. “By the end of the 2020 homebuying season, the majority of homebuyers will have made a sight-unseen offer. The pandemic has changed the way many people view homes, and on top of that, the market is highly competitive. If you aren’t using this strategy, another buyer who is could beat you to the punch.”
Redfin noted many Americans who were already considering relocating before the coronavirus pandemic are now taking the plunge, as mortgage rates continue to fall and employers implement flexible remote-work policies. A record 27% of house hunters looked to move to different metro area in the second quarter, up from 25% a year ago.
Additionally, Redfin reported nearly one-fourth of people who plan to buy a home in the next year are limiting the number of properties they’re touring in person due to the coronavirus, while 18% aren’t touring in person at all. Views of virtual 3D walkthroughs on Redfin.com have surged 243% since late February, and video tours led by Redfin agents now account for one in 10 of all Redfin home showings, up from less than 1% at the beginning of March.
Intensifying competition also contributed to the uptick in sight-unseen offers. More than half of Redfin offers faced bidding wars in June as the number of homes for sale continued to shrink and mortgage rates dropped to a record low.
The report can be accessed at https://www.redfin.com/blog/buying-house-sight-unseen-increases.
