The real estate market has become so hot that some homes put on the market for sale get multiple bids. Usually, this pushes prices higher.
The surge in residential real estate sales and prices is due to several factors. Many people want to leave expensive coastal cities. While the median value of a home in the United States runs about $350,000, the number stands at twice that in New York and San Francisco. The huge coastal cities also have higher overall costs of living.
Low mortgage rates have allowed people to buy homes they could not have afforded before. These rates have started to rise, which has spurred buyers to make decisions quickly to avoid even higher rates.
Finally, the COVID-19 pandemic has made the American workforce more mobile. Millions of people were sent home at the start of the pandemic, and many of them may avoid a return to the office.
The primary conclusion of the January Was the Most Competitive Month on Record for Homebuyers report from real estate broker Redfin was that “Seventy percent of home offers written by Redfin agents faced bidding wars in January on a seasonally adjusted basis, up from 67.7% in December and 61% in January 2021.” The study examined 40 metro areas.
The analysis showed:
Spokane, WA had the highest bidding-war rate of the 40 U.S. metropolitan areas in this analysis, with 83.3% of offers written by Redfin agents facing competition in January. Next came Sacramento, CA at 80.4% and Seattle at 79.7%. Dallas and San Francisco/San Jose rounded out the top five, with bidding-war rates of 78.1% and 76.5%, respectively.
Here are the 10 markets with the largest share of bidding wars:
| City | Jan 2022 | Jan 2021 |
|---|---|---|
| Spokane | 83.3% | 61.5% |
| Sacramento | 80.4% | 67.4% |
| Seattle | 79.7% | 75.1% |
| Dallas | 78.1% | 34.4% |
| San Francisco | 76.5% | 79.6% |
| Denver | 75.8% | 76.8% |
| Austin | 75.6% | 56.9% |
| Virginia Beach | 75.0% | 71.4% |
| Raleigh | 75.0% | 57.0% |
| Boston | 74.8% | 56.8% |
Click here to see the cities where buying a home is most expensive.
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