MReport released an article discussing a recent study Redfin conducted about home competition. Redfin surveyed roughly 500 agents during the month of January and found that a majority of offers faced competition. According to the article, home inventory is at its lowest point in seven years. Home listings fell 11.4% annually in January, which is the largest decline since March 2013. This also was the sixth straight month of decline. Redfin Chief Economist, Daryl Fairweather stated that there are several factors causing high competition in the housing market. Low mortgage rates have encouraged people to buy homes, which then leads to a rising demand for homes. Because the home inventory is low, it creates competition between buyers, which then drives up the prices of homes.
WHAT ELSE DID THEY FIND?
The survey found that San Francisco Bay was the most competitive city in America. Agents in this area estimated that roughly 90% of homes had multiple offers. The average home price in this area is $1 million. An agent in San Jose, Jennifer Tollenaar, stated “After missing out on one home due to a bidding war, my clients were much more aggressive on their next offer. In order to beat 24 other offers, they put 50% down, wrote a great letter to the sellers, and removed all contingencies. This was on a home with a purchase price of over $1.7 million.”
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