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Competition for homes on the market is lessening, which could provide an opening for home buyers who have been losing out amid this year’s bidding wars.
In August, about 59% of offers on homes written by Redfin agents faced competition, which is a record low for this year and the lowest level since 2020, according to a Redfin analysis. That’s down from a peak of 74% in April.
There have been additional recent signs that the housing market is cooling somewhat: Contract signings in July dropped, mortgage applications for home purchases—a gauge for future home buying—have been easing, and more sellers are making price adjustments.
Still, sellers continue to have the upper hand. The number of listings on the market is increasing but remains low compared with high buyer demand. Fifty percent of homes sold above their list price during the four weeks ending Sept. 5, according to Redfin. Eighty-nine percent of homes sold in July were on the market for less than a month, according to National Association of REALTORS® data.
“Sellers are still pricing their homes very high, but a lot of buyers have had enough and are no longer willing to pay the huge premiums they were six months ago,” said Nicole Dege, a Redfin real estate professional in Orlando, Fla. “Instead of 25 to 30 offers on turnkey homes, we’re now seeing five to seven.”
Dege said buyers are both becoming more selective and expecting more. “I have one seller who recently put his four-bedroom single-family pool house on the market, but the roof was shot,” she said. “He had to lower his asking price to $423,000 from $427,000 and agree to spend around $7,000 to replace the roof in order to attract bidders. Six months ago, he would have easily been able to sell that home as-is without dropping the price.”
In August, Raleigh, N.C., had the highest rate of bidding wars in the country, with 86.7% of offers written by agents reporting competition, according to Redfin’s analysis. The San Francisco/San Jose market followed at 70.7%; Tucson, Ariz., at 70.5%; Cincinnati at 70.4%; and Salt Lake City at 68.1%.