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Homebuying competition heated up in February, and buyers in the Bay Area and New York led the charge. However, not every home fetched top dollar.
A recent Redfin report found that 20.5 percent of homes sold above asking price in February, while 64.2 percent sold below and 15.4 percent sold at their asking price nationwide. Compared to last year, fewer homes are selling at or above their asking price — a sign that the market may be shifting in favor of buyers.
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Despite this trend, buyers in some major markets are still pushing prices higher. In eight of the nation’s largest metros, there was an uptick in homes that sold above asking price last month — half of those metros in the Bay Area or New York.
Redfin | Homes selling above, below or at asking price
San Jose, California, led the pack, with 67.1 percent of homes selling above asking price, followed by Oakland, California, at 57.7 percent; San Francisco at 57.2 percent; and Nassau County, New York, at 47.1 percent.
According to Redfin experts, this surge stems from pent-up demand, but momentum is beginning to slow as buyers wait for more inventory to hit the market.
Josh Felder | Redfin Premier Real Estate Agent
“The Bay Area has an unending population of people with enormous swaths of money,” Josh Felder, a Redfin Premier agent in the Bay Area, said in a statement. “A decade or so ago, we all thought the growth in home prices was unsustainable, but they just keep going up and up. That’s partly because there aren’t enough homes for sale and partly because tech continues to boom despite ups and downs in the stock market and geopolitical uncertainty.”
Felder recalled a recent home sale in San Jose where he submitted an offer amid 22 competing bids. The home ultimately sold for about 10 percent over asking price. He noted that in 2017 and 2018, it was even common for homes to go 15 percent or more above their list price.
While housing inventory remains tight, the Bay Area is seeing some improvement. Active home listings are up 5.8 percent year over year in San Francisco and 27 percent in San Jose. However, for meaningful progress on the inventory front, real estate professionals stress the need for more streamlined housing production, proactive local and federal housing policies, and innovative mortgage solutions.
