Homebuyer Competition Drops to Lowest Level in Two Years
The nationwide bidding war rate fell below 50% in June for the first time since May 2020 as a result of inflated housing costs pushing a growing number of would-be buyers to the sidelines. Of all home offers written by Redfin agents during the month of June, 49.9% faced competition on a seasonally adjusted basis, marking the fifth consecutive monthly decline in a rapidly cooling market, Redfin reports.
Roughly 60,000 home-purchase agreements were ultimately called off in June, a record share equal to 14.9% of all homes that went under contract that month. Riverside, CA saw the largest year-over-year drop in homebuyer competition, followed by Raleigh, NC, and Charlotte, NC.
In Riverside, CA, 31.9% of home offers written by Redfin agents faced competition in June, down from 70.5% a year earlier. That 38.6-percentage-point decline was the largest among the 36 U.S. metropolitan areas in this analysis. Next came Raleigh, NC (38.9% vs. 74.1%; -35.2 ppts), Charlotte, NC (48.1% vs. 80%; -31.9 ppts), Seattle (41.4% vs. 71.6%; -30.2 ppts) and Honolulu (38.9% vs. 69%; -30.2 ppts).
“Showings have dramatically decreased. Homes that would’ve had 20 showings two months ago are now getting one or even none,” said Jenny Dedrick, a Redfin real estate agent in Minneapolis, where the bidding-war rate fell to 45.7% in June from 65% a year earlier. “I had one seller take his home off the market because it only got one showing. He decided to rent it out instead. He’s moving to Mexico and thought, ‘why not let it sit and keep appreciating?’”