As the share of Redfin offers facing competition plummets to an eight-year low nationally, the Seattle metro area has seen a particularly spectacular decline in bidding wars, falling from 75 percent of all offers local Redfin agents wrote earlier this year to just 19 percent in the first half of December. The flip inside the city limits was even more dramatic, falling from 81 percent of Redfin offers facing a bidding war in February to just 10 percent in the first half of December.
Every part of the city has rapidly cooled off this year. Even North Seattle neighborhoods that had 90 percent of offers facing competition in the first quarter have fallen to just 28 percent in the fourth quarter through December 15.
The steep fall in bidding wars is a good news / bad news type of situation. Good news for buyers, bad news for sellers.
“The last time I had multiple offers on a condo was in May,” said Redfin agent Jessie Culbert. “Sellers are learning that expecting a bidding war on their home is no longer a reasonable assumption, so they’re more often pricing where they’d be happy to receive one offer at list price, versus pricing lower and hoping for an escalation. For buyers, the home-buying process isn’t as frenzied as it was at the beginning of the year, with more time for the decision-making process and more opportunities to preserve financing and inspection contingencies.”
Of course, even though bidding wars have fallen off a cliff this year, that doesn’t mean they have gone away completely. In South Seattle nearly a third of offers (29%) are still facing competition, down from almost two thirds (65%) in the first half of the year.
”There are still a few particularly popular or well-priced homes receiving multiple offers or being snapped up quickly, so I’d caution buyers to not get too complacent,” warned Culbert.
It’s likely that December will be a low point for bidding wars until next fall. The rate of bidding wars typically spikes as soon as the calendar turns over to a new year, so expect this measure to begin climbing again in just a few weeks, but unless something unexpected happens, we probably won’t see a return to the highs of the last few years.
