It looks like the number of offers facing bidding wars is beginning to subside, a potential indicator of a cooling market, according to Redfin.
In its latest Bidding War Report, Redfin revealed that 69.5% of offers written by Redfin in May faced competition. In April, 73.3% of offers competed against multiple bids.
However, May’s numbers aren’t far off from May 2012, when 69.3% of Redfin offers went into bidding wars.
The lessening of multiple bidding situations is likely due to a substantial monthly increase in inventory in April, when the number of homes rose 6.4% from March, the largest monthly gain since 2010.
California still houses the most competitive markets, with San Francisco, Los Angeles and Orange County Redfin buyers facing competition on more than eight out of every 10 offers in May.
However, even The Golden State is cooling somewhat, with San Diego and Orange County posting the largest month-over-month declines in competition. In fact, from April and May, San Diego and Orange County saw 16.4% and 10.3% drops in the percentages of Redfin offers facing bidding wars.
Conversely, Marshall Park, who manages Redfin’s Washington D.C. market, noted that homes were sitting on the market longer than they previously were. However, but “longer,” he meant three of four weeks, which would have seemed incredibly fast three years ago.
Check out some of the creative ways buyers are coercing sellers to accept their offers by reading the full Redfin blog post here.
However, despite the drop in competition, in a Fannie Mae report released Monday, American confidence in the ability to buy and sell a home ascended sharply in May due to recently strong home price gains.