Looking to buy a home in San Jose or Seattle? Well good luck, these housing markets are amongst the most competitive in the nation, according to Redfin.
It’s no secret that existing home sales have regularly decreased for the last few months, signaling a severe housing shortage that is negatively impacting the market.
However, as some markets take hits, others are thriving and rich with competition. Because of this, Redfin released its Compete Score, which rates housing competition in cities and neighborhoods. The tool is used to help sellers strategize listings, and homebuyers understand “what it takes” to win a home in some of the country's most lucrative markets.
Redfin Compete Score ranks markets from a 0-100 scale. Homes in markets ranked closer to 0 take months to sell, whereas homes in areas that rank closer to 100 typically receive multiple offers.
According to Redfin, these are the most competitive cities in America:
Rank City Score
1 Fremont, CA 100
1 San Jose, CA 100
1 Seattle, WA 100
2 Oakland, CA 97
3 Aurora, CO 96
3 San Francisco, CA 96
4 Tacoma, WA 95
5 Denver, CO 92
5 Boston, MA 92
6 Sacramento, CA 91
Redfin Senior Economist Taylor Marr says that many of the most competitive cities are tech hubs that attract buyers who are searching for jobs, but lack tremendous inventory.
“This has led to intense competition and rising home prices,” Marr said. “In San Francisco, Seattle and Denver, homes have become so expensive that many people are moving elsewhere in search of more affordable and less competitive housing markets.”
When West Coast prices outsize the pockets of potential homebuyers, many turn to markets that have larger inventory or more affordable rates.
“I often work with people who are relocating to New Orleans, having been priced out of coastal markets like Seattle and San Francisco,” New Orleans Redfin Agent Caren Morgan said. “They’re relieved to find we have a healthy, relatively affordable housing supply and that homes typically remain on the market for about two months before going under contract.”
According to Redfin, these are the least competitive cities in America:
Rank City Score
1 New Orleans, LA 43
2 El Paso, TX 44
3 Pittsburgh, PA 47
3 Miami, FL 47
4 Newark, NJ 52
5 Scottsdale, AZ 54
6 Boise, ID 57
6 Baton Rouge, LA 57
6 Norfolk, VA 57
7 Cincinnati, OH 58
Although these cities tend to be less expensive, affordability is still a concern for the market overall.
Freddie Mac’s latest Primary Mortgage Market survey indicated that mortgage rates reached its highest level since June of 2017.
Freddie Mac Chief Economist Sam Khater said that although the economy is healthy, affordability is still a concern for the housing market, and the next few months will be key in understanding its health.
Nonetheless, for many prospective homebuyers, mortgage rates will determine which city they decide to call home.