December Home-Buying Competition Varied Greatly by Market in Latest Redfin Bidding War Report

Frosty Weather Conditions in Northeast Caused Competition to Plummet in Boston, Baltimore

PR Newswire
December Home-Buying Competition Varied Greatly by Market in Latest Redfin Bidding War Report
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52 Percent of Redfin offers faced bidding wars in Dec. 2013 Click Here to Download Image

SEATTLE, Jan. 22, 2014 /PRNewswire/ -- Redfin (www.redfin.com), the technology-powered real estate brokerage, today released its December 2013 Real-Time Bidding War Report based on Offer Insights, statistics compiled from thousands of offers written each month by Redfin agents for their home-buying clients.

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After falling sharply since the spring, the percentage of Redfin offers facing bidding wars was down just slightly to 52 percent, from 52.8 percent in November, and 62.4 percent a year earlier. This number is the average across 22 U.S. markets. Although the average was basically flat, the market-by-market numbers tell a different story. Between November and December, bidding wars increased in half of the markets and decreased in the other half. The contrasting bidding war trends likely reflect regional and seasonal factors that impacted the U.S. markets in December, including holidays, snow storms, and the limited number of homes for sale. 

"Boston had multiple snowstorms during December, which fully shut down home tours at times," said Adam Welling, a Redfin real estate agent in Boston. "For the adventurous homebuyers who braved the arctic-like conditions, the reward was a bit of space in a market that had otherwise been congested and claustrophobic."

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The report's key findings include:

Multiple Offers

  • Competition during December fell the most in Boston and Baltimore, which saw bidding wars drop 19.7 and 13.5 percentage points, respectively.
  • Bidding wars became more common in December in San Jose (+7.9 points), Chicago (+3.7 points), and Washington, D.C. (+3.7 points).

Price Escalations

  • San Jose was the only market among Redfin's most competitive where the average home sold for more than its asking price, with home-sellers enjoying premiums of 2.5%.
  • In San Jose, 60% of homes sold for more than asking price in December. San Francisco came in second with 48.9% of homes selling above list price.

Competitive Strategies

  • The cover letter remained a commonly-used competitive strategy in December, with 36.1% of Redfin clients' winning offers including a cover letter, up from 35.9% in November, and 23.7% in October. Redfin buyers used cover letters most often in San Diego (63.6%) and San Francisco (53.3%).

To read the full report on Redfin's blog, complete with local market rankings, 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/2014/bidding-war-december-2013.html

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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.com features all the broker-listed homes for sale, as well as for-sale-by-owner properties that don't pay brokers a commission. Redfin also offers online tools that make the entire process of buying or selling a home easier and more fun. The company serves 22 U.S. markets and has closed more than $13 billion in home sales. In 2012, Redfin was named one of The DIGITAL 100: World's Most Valuable Private Tech Companies by Business Insider.

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