54% of Redfin offers faced bidding wars last month amid record-low mortgage rates and an acute shortage of homes for sale. Boston was one of the most competitive markets.
More than half of Redfin home offers faced competition in July for the third month in a row. Nationwide, 54% of Redfin offers encountered bidding wars last month, down slightly from June’s revised rate of 56%.
An offer is considered part of a bidding war if a Redfin agent reported that it received at least one competing bid.
Bidding Wars Remain Steady
Even as the coronavirus pandemic continues to send shockwaves through the U.S. economy, the bidding-war rate remains steady as homebuyers contend with competition driven by a dearth of homes for sale and record-low mortgage rates. Last month, the average rate on 30-year fixed mortgages dropped below 3% for the first time in recorded history.
“Bidding wars may slow down if interest rates tick up again, which could happen if we get good news about a coronavirus vaccine or more clarity around the outcome of the upcoming U.S. presidential election.
Single-family homes were most likely to encounter bidding wars in July, with 56% of Redfin offers facing competition, followed by townhouses, at 54%. Meanwhile, just 42% of offers for condos experienced bidding wars. Online searches for single-family homes recently rose to the highest level in four years as Americans sought out larger houses located farther away from dense urban areas, according to a June Redfin report.
When broken down by price, homes priced between $400,000 and $500,000 were most likely to be met with the competition, with 56% of offers facing bidding wars. By comparison, just 46% of offers for homes that were listed above $1.5 million received multiple bids in July.
Bidding-war rates by metro area, July 2020 and June 2020
|Metro Area||Share of Redfin offers that faced bidding wars in July 2020||Share of Redfin offers that faced bidding wars in June 2020|
|Salt Lake City, UT||75%||67%|
|San Francisco / San Jose, CA||67%||61%|
|San Diego, CA||65%||70%|
|Los Angeles, CA||58%||67%|
|New York, NY||53%||53%|
|Las Vegas, NV||32%||44%|