Far fewer homes facing multiple bids, a big change from a year ago
There was a fairly small chance that homebuyers faced a bidding war in July, compared with the prior year when the odds were almost 50-50, according to Redfin.
Only 11.2% of offers submitted through Redfin agents by potential home purchasers faced at least one other bid, which is the lowest rate for multiple offers since 2011. Competition has become a lot less burdensome for buyers than in July 2018, when the share was a much higher 45%.
"Mortgage rates have been mostly flat for the last month, and so has homebuyer competition, which was beginning a fast descent this time last year as mortgage rates were inching toward 5%," Daryl Fairweather, Redfin's chief economist, said in a press release.
"On a local level, it's noteworthy that some of 2018's fiercely competitive markets — San Jose, Seattle, Los Angeles — have seen their bidding war rates plummet the most year-over-year. Home prices in these expensive markets have also been falling annually. Overall, I expect homebuyer demand to strengthen in the second half of the year as the housing market continues to stabilize, but we may not see a big pop in bidding wars until early next year," she continued.
Miami was the least competitive of the major markets analyzed by Redfin, where just 1.3% of the offers had a competing bid.
On the other hand, potential buyers making offers for properties in San Francisco faced the most competition, at 35%. Notably, the share of houses for sale receiving multiple offers in the city was cut by more than half from the prior year, when it was 72.4%. Still, lower mortgage rates and desirable job offerings keep the Golden Gate City in demand.
"Although the market isn't as hot as it was last year, this spring and summer have been busy in San Francisco. That's partly because homebuyers are feeling pressure to move quickly due to the high-profile tech IPOs, whether that pressure is real or perceived. Low interest rates are also a factor in increased homebuyer interest since the beginning of the year. The market has definitely picked up since the winter and it seems like prices and competition are slowly heading back to mid-2018 levels," said San Francisco Redfin agent Miriam Westberg.