Great News for Homebuyers: Bidding Wars Are Calming Down
As more houses go on the market, bidding wars are calming down, says a new study by Redfin—and that’s great news for you as a homebuyer!
This past year has been a nightmare for homebuyers across the nation. Buyers have had to bid on dozens of homes, offer tens of thousands of dollars more than asking price, and given up basic contingencies.
As a result, many people—perhaps you included—have decided to wait until the market cools down to buy a home. Thankfully, it seems that may happen sooner than you think!
Although the bidding frenzy nationwide is still more intense than it was last year, it’s now the lowest it’s been since January. In April, the percentage of home offers that faced competition hit its peak at 74.1% but nosedived to 60.1% in July.
And if you live in San Diego or in a nearby area, the news gets even better. Bidding competition was lower last month (July 2021) than it was the same time last year.
So what does this mean for you as a homebuyer? Our team here at Native Real Estate sees a few trends on the horizon that could affect your homebuying process in the next several months.
Buying a Home Will Get a Little Bit Easier
The first trend we expect to see soon is that homebuyers will feel less pressure during the bidding process. In other words, you can expect it to be a little easier to find your dream home.
Don’t get us wrong—we’re still definitely in a seller’s market. But real estate agents are already seeing the bidding wars calm down.
Scott Mercer, a Redfin real estate agent in Sacramento, California, says home sellers are now receiving five to eight offers instead of 25, and buyers are bidding $5,000 to $10,000 above asking price instead of $50,000 to $60,000.
Mercer also sees buyers pushing back more, adding appraisal contingencies and requesting repairs. Buyer requests like these were unheard of just a few months ago.
Homebuyers Will Have More Options
One of the reasons housing inventory has been so low is that sellers were afraid they couldn’t afford to purchase another home because prices were so high. (And one of the reasons prices were so high is because so few homes were on the market!)
But now that bidding wars are cooling down, potential sellers are likely to be more willing to list their home for sale. In many areas of the country, we’re already starting to see this happen. The number of new listings rose during the summer as an increasing number of smaller homes went on the market, reports Realtor.com.
This means that housing prices should continue to dip.
Perhaps you’ve already noticed prices dropping in your neighborhood. While the median home price in San Diego County continues to hover higher than last year, it’s decreased over the last two months. Since June 2021, the median sale price has dropped from $765,000 to $749,500, according to Redfin.
We still have a ways to go before the housing market is back to the pre-pandemic “normal,” but the trends we’re seeing are positive signs for homebuyers! They show that, with a great realtor, you can find a beautiful home at a much more reasonable price—and without conceding to a seller’s every demand.
If you’re ready to buy a home or investment property, our team of professional real estate agents and brokers here at Native Real Estate is ready to serve you. Call us at 858-461-9612 or schedule a meeting here to find your dream home!