MBA NewsLink Staff
July 12, 2019
Redfin, Seattle, said just 12 percent of Redfin offers faced a bidding war in June, down from 52 percent a year earlier.
The report (https://www.redfin.com/blog/june-2019-bidding-wars) said the least competitive market in June was Miami, where none of the offers submitted by Redfin agents faced competition. Dallas (5.3%) and San Jose (6.3%) were the second and third-least competitive. The most competitive market was San Francisco, where 28 percent of offers written by Redfin agents faced a bidding war in June; however, this was down from 65 percent a year earlier. San Diego (19%) and Boston (17%) were the next-most competitive metros. No other metro area saw more than one in six offers face competition in June.
“Bidding wars are still somewhat common in San Francisco, mostly at price points around $1 million, which is relatively inexpensive for the city, but enough to buy a modest house in a number of neighborhoods,” said Redfin San Francisco listing agent Chris Jurach. “Once you get above around $1.25 million, buyers are being more selective, leading to fewer bidding wars in those upper price ranges.”
The report said even as San Francisco saw more than a quarter of offers face bidding wars, just south in San Jose, only 6 percent of offers faced competition in June, down from 74 percent a year earlier. The rate also fell by 12 points from May to June, slightly more than the 9 point drop over the same period a year earlier.
“San Jose buyers have seen homes for sale staying on the market longer, and more sellers dropping prices than either of the last two years,” said Redfin San Jose agent Stella Phua. “When they see the market slowing down, they prefer to take a ‘wait and see’ approach. The only homes that are getting multiple offers now are the ones in the best locations, great condition, and priced lower than similar homes in the neighborhood.”
Redfin Chief Economist Daryl Fairweather noted, however, other early housing market indicators suggest that the cooling trend could be short-lived. “With low mortgage interest rates luring more homebuyers off the sidelines as supply dwindles, we’re likely to see competition pick back up, especially for the most affordable homes and neighborhoods, where inventory is limited and buyers are most rate-sensitive,” she said.