Bidding war rates on U.S. houses hit their lowest point in a year last month, but they’re still notably higher than pretty much all of 2020.
New data from Redfin shows that three in five homes faced multiple offers in December. That’s lower than the April highs of nearly 75%, but higher than December 2020’s 54%. And in some cities, the bidding wars are still raging.
“Buyers should anticipate that they may not win a house until their sixth or seventh bid,” Redfin team manager Candace Evans said in a statement. “If you’re the type of person who falls in love with a house, this is not your market. If you show a house to 10 buyers, you’ll probably get eight offers.”
Homes priced between $800,000 and $1 million were the most likely to face a bidding war, said Redfin. Homes beyond the $1 million mark were also frequently subjected to multiple bids. But among houses with price tags ranging between $200,000 and $800,000, 55% saw a bidding war break out. (Townhouses and single-family homes were the most competitive properties.)
The number of homes for sale last spring hit the lowest level in more than 40 years. And it’s not looking any better for 2022. At present, the housing market is tighter than it was heading into the hypercompetitive 2021 spring housing market. Rising mortgage rates, however, could be an X factor in demand.
Hot housing markets
Geographically, Salt Lake City saw the most bidding wars in December, with 74% of listings seeing competitive offers. Here’s how other cities shook out as of December 2021, as judged by the percentage of Redfin listings receiving offers that faced bidding wars that month.
Salt Lake City 74%
Tucson 73.1%
San Diego 71.1%
Virginia Beach 70.6%
Seattle 70%
Tampa 68.3%
San Francisco/San Jose 67.5%
Denver 66.7%
Sacramento 66.7%
Honolulu 65.9%
Cooling housing markets
As for cities where bidding wars are slowing down? A handful were notably below the national average:
Indianapolis 39.3%
Cape Coral, Fla. 45%
Cleveland 45.5%
Chicago 46.7%
Houston 47.1%
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