Homebuyers have grappled with intense competition over the past year because low mortgage rates and a pandemic moving spree made possible by remote work have prompted scores of Americans to purchase houses. This has intensified an already-acute shortage of homes for sale, meaning there are far more buyers than sellers.
Mortgage rates, however, have started moving higher. The interest rate for a 30-year fixed-rate mortgage is now about 3.09%, compared with 2.67% at the end of 2020. For now, this appears to be increasing urgency among homebuyers rather than scaring them off.
"The uptick in mortgage rates is likely fueling more bidding wars in the short term because house hunters are rushing to buy homes before rates rise even further," said Redfin Chief Economist
According to a recent Redfin survey, 17% of people would slow down their home searches if mortgage rates surpassed 3.5%.
Another sign of a competitive market is when homes sell quickly and fetch more than sellers are listing them for. The typical home that sold in February went under contract in 32 days—23 days faster than a year earlier—and a record 36% of homes went for more than their asking prices.
"Every home I put on the market for under
With many Americans moving to more affordable places during the pandemic,
"You have to pull out all of the stops. Successful buyers are offering
High-End Homes Were the Most Likely to Attract Bidding Wars
Homes listed between
Single-family homes had a bidding-war rate of 63.7% in February, making them the property type most likely to encounter competition. By comparison, 58.5% of offers for townhomes and 49.3% of offers for condos faced bidding wars.
Single-family homes have performed relatively well during the pandemic because homebuyers have been prioritizing space and privacy over shorter commute times and access to city centers.
To view the full report, including charts and metro-level data, please visit: https://www.redfin.com/news/real-estate-bidding-wars-february-2021
Redfin (www.redfin.com) is a technology-powered real estate broker, instant home-buyer (iBuyer), lender, title insurer, and renovations company. We sell homes for more money and charge half the fee. We also run the country's #1 real-estate brokerage site. Our home-buying customers see homes first with on-demand tours, and our lending and title services help them close quickly. Customers selling a home can take an instant cash offer from Redfin or have our renovations crew fix up their home to sell for top dollar. Since launching in 2006, we've saved customers nearly
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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Redfin Journalist Services: Angela Cherry, 913-638-8249, firstname.lastname@example.org