Redfin real estate analyst Tim Ellis just collected information from offers that Redfin agents have prepared since January 1, 2012, to gauge just how often our customers are bidding on listings that have competing offers. In major California markets, more than half of our offers faced competition. Here are the Redfin markets where competition is most common in 2012:
- Bay Area: 73.0% of Redfin offers faced competition
- Southern California: 62.3% of Redfin offers faced competition
- Seattle: 48.9% of Redfin offers faced competition
- DC Area: 42.4% of Redfin offers faced competition
- Long Island: 41.7% of Redfin offers faced competition
- Boston: 40.9% of Redfin offers faced competition
In other markets, our offers face competition less often, between 22% and 39% of the time, but still most customers are shocked that there is any competition whatsoever.
And this is one reason why Redfin, after describing the market in years past as a “fat man who can’t get up” and predicting declines of 5% – 10%, is now forecasting the end of major declines when others have called for another year of falling prices.
As real estate agents who buy and sell homes, we have access to real-time data about what is happening now in the market. Because we use technology to generate offers and schedule tours via a central database, we can track this at scale. And what we see happening, at least for now, is that demand is outpacing the supply of homes for sale.
This doesn’t always mean that listings are selling for more than the asking price. Just last week, we hosted an open house for a Redfin listing in Chicago’s Wicker Park that attracted 30 different individual buyers or couples, and immediately generated three offers, all under the asking price. It is now pending, but still for slightly less than the asking price. Even when everyone wants a house, not everyone is willing to pay for it, at least not for now.
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