Home News A Record-Month for Bidding Wars in the U.S.

A Record-Month for Bidding Wars in the U.S.

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Since the beginning of the pandemic, there has been no end to fierce competition for housing that has disrupted the US real estate market, especially in the entry-level luxury home market.

In February, homes listed between $ 1 million and $ 1.5 million hit a record high. Bidding war According to a report by Redfin on Friday, an analysis of housing offers written by agents showed 76.6%. Nationally, a record 68.6% of all homes saw a bid war on a seasonally adjusted basis.

The proportion of homes facing a bid war has generally increased over the last two years. In April 2020, 32.7% of homes experienced a bidding war, compared to 60.2% in February 2021. Growth has slowed since 2021, but this year’s performance continues to break records.

Redfin


Darryl Fairweather, Chief Economist at Redfin, said: “The bidding war intensified this year after interest rates began to skyrocket. It ignited under buyers. If prices continue to rise as expected, competition could stall or even decline. I have.”

El Paso, Texas; Denver; Minneapolis had the highest rate of bid wars compared to other metropolitan areas in the United States. In El Paso, nearly 9 out of 10 households faced a bid war, accounting for 87.5%. Denver and Minneapolis followed at 83% and 81.1%, respectively.

“El Paso’s home inventories are ridiculously low, especially for new homes, as they are causing a bidding war,” said Salvador Palos, a local Redfin real estate agent. “It’s not uncommon for a new home to receive 10 to 15 offers and sell for $ 20,000 above the asking price.”


The best competition is in townhouses across the country, with three of the four townhouses experiencing a bid war at a rate of 75.3%. Single-family homes followed at 72.9%. 64.8% apartments, 64.6% condominiums and co-operatives.

Although mortgage rates are rising, low levels of mortgages have also boosted demand. The Federal Reserve raised interest rates on Wednesday for the first time since 2018.

“This has led to an average 30-year fixed mortgage rate of over 4% for the first time since 2019, reaching 4.16% in the week leading up to March 17, from a record low of 2.65% about two years ago. It’s rising, “says the report. OK.

“New buyers’ monthly mortgage payments are already at record highs. As they continue to sneak up, some buyers become bystanders,” Fairweather said.


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