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More than 50% of Redfin offers faced competition for the third month in a row, according to a press release. In July, 54% of offers nationwide encountered bidding wars. Redfin revealed that this is 2% less than June, however, after mortgage rates hit new record-lows once again in August, there is potential for another spike in bidding wars in the weeks ahead.
"If coronavirus cases continue to climb, more employers will likely make flexible remote work policies standard procedure, which will drive further migration out of large, expensive cities. As a result, we may see bidding wars gain more traction in suburban areas and small towns," said Redfin chief economist Daryl Fairweather.
Last month, the average 30-year fixed-rate mortgage dropped below 3% for the first time in recorded history. Just last week, the 30-year fixed-rate mortgage plunged once again to 2.88%, hitting yet another historical low.
"Single-family homes were most likely to encounter bidding wars in July, with 56% of Redfin offers facing competition, followed by townhouses, at 54%. Meanwhile, just 42% of offers for condos experienced bidding wars," according to Redfin.
Additionally, homes priced between $400,000 and $500,000 were most likely to enter a bidding war. The report revealed that Salt Lake City had the highest rate of competition with San Francisco/San Jose and San Diego following respectively.
"It's as hot a seller's market as I've ever seen," said Greg Mathers, a Redfin agent in the San Francisco area. "One of my clients recently bid $100,000 over a home's asking price and only had the eighth-highest of 15 offers. It's coming down to how much money you can throw at a house and how many contingencies you can waive."
Click here to read more about Redfin offers' bidding wars.