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American homebuyers have faced fervent competition during the coronavirus pandemic, resulting from a jump in relocations made possible by remote work, a severe housing shortage and record-low interest rates. In the first week of 2021, the rate on 30-year fixed mortgages sank to 2.65%—the 17th all-time low in less than a year.
The housing market usually slows down significantly during the winter months as families take time off for the holidays and avoid the cold weather, but that wasn't the case this year. Home prices increased 13.1% year over year in December, and home sales grew 16.2% on a seasonally adjusted basis.
"The housing market is unseasonably hot—it's behaving like it normally does in the spring, with plenty of demand from homebuyers," Redfin chief economist
The
"In Salt
An acute shortage of homes for sale, along with booming demand, is fueling
Million-Dollar Homes Were the Most Likely to Attract Bidding Wars
Homes listed between
"Luxury homes in
Competition for high-end homes is on the rise in part because so many affluent Americans have been relocating during the pandemic. Sales of luxury homes surged 61% in the fall, far outpacing the 7% increase in sales of affordable homes, a recent Redfin analysis found. Similarly, demand for second homes has skyrocketed 100%—further evidence of the country's "K-shaped" economic recovery.
Single-Family Homes Were Much More Likely to
Single-family homes were the most likely property type to attract bidding wars in December, with 53.6% of Redfin offers encountering competition. That compares with a bidding-war rate of 46.1% for townhouses and 33.9% for condos.
The single-family home has been the hottest property type during the pandemic because it typically offers more space and privacy—essential features for many families that are working from home and engaging in remote learning. With shared amenities and close quarters, condos haven't fared as well.
Bidding-War Rates By Metro Area,
Metro Area* |
Share of Redfin offers that faced |
Share of Redfin offers that faced |
|
75.6% |
56.0% |
|
74.5% |
80.1% |
|
67.4% |
66.7% |
|
65.3% |
62.5% |
|
58.4% |
66.7% |
|
58.3% |
44.9% |
|
57.8% |
59.1% |
|
57.8% |
60.4% |
|
57.5% |
63.7% |
|
55.8% |
62.5% |
|
53.9% |
69.5% |
|
50.0% |
50.0% |
|
47.1% |
42.4% |
|
46.5% |
49.7% |
|
45.8% |
40.0% |
|
45.5% |
54.5% |
|
44.2% |
54.1% |
|
42.3% |
37.0% |
|
39.6% |
41.4% |
|
35.9% |
47.4% |
|
29.3% |
37.2% |
|
25.2% |
37.2% |
|
21.5% |
37.5% |
|
21.3% |
45.2% |
*To be included in this analysis, metros must have had at least 20 offers written by Redfin agents from
To view the full report, including charts and methodology, please visit: https://www.redfin.com/news/real-estate-bidding-wars-december-2020/
About Redfin
Redfin (www.redfin.com) is a technology-powered residential real estate company, redefining real estate in the consumer's favor in a commission-driven industry. We do this by integrating every step of the home buying and selling process and pairing our own agents with our own technology, creating a service that is faster, better and costs less. We offer brokerage, iBuying, mortgage, and title services, and we are the #1 nationwide brokerage website, offering a host of online tools to consumers, including the Redfin Estimate. We represent people buying and selling homes in over 90 markets in
For more information or to contact a local Redfin real estate agent, visit www.redfin.com. To learn about housing market trends and download data, visit the
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SOURCE Redfin
Redfin Journalist Services: Isabelle Novak, 414-861-5861, press@redfin.com