Competition Among Homebuyers Declined Again in September in Latest Redfin Report
Real Estate Brokerage Predicts Uncertainty over Lack of Debt Ceiling Resolution will Exacerbate Typical Seasonal Slowdown
SEATTLE, Oct. 22, 2013 /PRNewswire/ -- Redfin (www.redfin.com), the technology-powered real estate brokerage, today released its September 2013 Bidding War Report, based on Offer Insights, statistics compiled from thousands of offers written each month by Redfin agents for their home-buying clients. Offer Insights data includes multiple-offer sales, homes that sold above list price, and asking price vs. sale price. Redfin also tracks all-cash offers, waived contingencies and inspections, and the use of cover letters in offers.
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Bidding wars dropped for the sixth consecutive month this September with 58.3 percent of offers written by Redfin agents facing competition, down from 60.5 percent in August and 76 percent in March. Competition in September fell below 2012 levels for the second consecutive month, suggesting that last year's late-season surge is unlikely to be repeated this year. Slightly lower interest rates did not spur competition, underscoring the market's continued shift towards balance. The economic uncertainty that surrounded the government shutdown and debt ceiling battle suggest that competition will continue to soften in October.
The report's key findings include:
Multiple Offers
- Competition declined the most in Orange County, with a drop from 81.8% of Redfin offers facing competition in August to 72.2% in September.
- Seattle, however, experienced that largest rise in competition ramped up the most in Seattle, with a bump from 49.2% in August to 57% in September.
Asking Price vs. Sale Price
- Only San Francisco and Seattle had offers that averaged higher than asking prices, registering 7.3% and 1.4% above asking price, respectively.
All-Cash Offers
- From August to September, all-cash offers fell in popularity as a winning strategy in San Francisco (falling from 11.5% of offers to 3.6%), San Diego (15.8% to 11.1%), Washington D.C. (10.5% to 0.0%) and Seattle (12.5% to 5.6%).
Pre-Inspections
- Pre-inspections, after not being used in any of Redfin's competitive offers in August, made a comeback in September. Winning bidders in San Francisco (7.1%) and Seattle (5.6%) used this strategy, which involves completing a home inspection before making an offer, in order to make the offer stronger and reduce the risk of the deal falling through.
The table below ranks the hottest real estate markets in order of competitiveness.
| Rank |
Market |
Competition 09/2013 |
Competition 08/2013 |
Competition 09/2012 |
Over Asking 08/2013 |
Diff. vs. Ask 08/2013 |
| #1 |
San Francisco |
77.3% |
84.7% |
81.3% |
82.1% |
7.3% |
| #2 |
Orange County |
72.2% |
81.8% |
75.0% |
37.0% |
-0.1% |
| #3 |
Los Angeles |
72.2% |
79.2% |
81.2% |
34.5% |
-1.0% |
| #4 |
Boston |
70.1% |
62.4% |
46.8% |
46.7% |
-1.4% |
| #5 |
Seattle |
57.0% |
49.2% |
56.4% |
44.4% |
1.4% |
| #6 |
San Diego |
56.1% |
64.4% |
75.0% |
11.1% |
-2.3% |
| #7 |
Washington, D.C. |
47.0% |
55.0% |
57.5% |
22.2% |
-1.4% |
| #8 |
Chicago |
42.7% |
35.2% |
37.3% |
16.7% |
-11.7% |
| #9 |
Baltimore |
34.5% |
29.8% |
33.3% |
0.0% |
0.0% |
| 22 Markets |
58.3% |
60.5% |
62.7% |
40.2% |
-0.4% |
To read the full report on Redfin's blog, complete with accounts of real bidding wars from Redfin agents and market-by-market statistics on offer strategies, click the following link.http://www.redfin.com/research/reports/real-time-bidding-wars.
About Redfin
Redfin (www.redfin.com) is a technology-powered real estate broker that represents people buying and selling homes. Founded and run by technologists, Redfin has a team of experienced, full-service real estate agents who are advocates, not sales-people, earning customer-satisfaction bonuses, not commissions. Redfin's online tools feature all the broker-listed homes for sale, as well as for-sale-by-owner properties that don't pay brokers a commission. The company serves 22 U.S. markets and has closed more than $8 billion in home sales. In 2012, Redfin was named one of The DIGITAL 100: World's Most Valuable Private Tech Companies by Business Insider. Follow us on our blog (blog.redfin.com), Twitter (@redfin), and Facebook (facebook.com/redfin).
SOURCE Redfin
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