The Redfin Housing Demand Index fell 4.9 percent to 118 in April, the fifth consecutive month of year-over-year declines. Early stage demand strengthened, with the number of Redfin customers requesting tours up 19.8 percent year over year, up from the 17.7 percent increase recorded in March. The late stage is where demand slid, with a 6.7 percent year-over-year drop in the number of customers writing offers in April.
Across the 15 metro areas measured by the Demand Index, home prices were up 5 percent in April from a year earlier as sales grew a modest 1.3 percent. April marks a year of consistently falling inventory as the total number of homes for sale fell 2.2 percent. New listings were essentially flat, down 0.3 percent from last year.
Even with fewer buyers making offers than last year, the persistent depletion of supply made the market extremely competitive for those who bid on homes. Last month, 63 percent of offers Redfin agents wrote faced bidding wars, exactly on par with last year’s frequency. And 29.6 percent of homes sold for more than their asking price, the highest level recorded since August 2013. The typical home stayed on the market for just 17 days, four days fewer than last year. In Denver, the fastest market, homes went under contract in a median five days. Buyers had just a little more time in Portland and Seattle, where the typical home took a week to sell.
“Timing is everything in today’s market,” said Redfin chief economist Nela Richardson. “Even though it’s a seller’s market, a lot of sellers are also buyers who are risk averse as they confront an inventory drought while finding their next home. As sellers, they’re often taking the sure bet over the highest offer, whether it’s all cash or a lender guaranteeing a quick close. Only people with time wrangle up the price.”
Examples of homes that sold in a matter of days but without exceeding asking price by more than a few thousand dollars include these three homes in the hot Denver market.
Good news for buyers is that bidding wars appear to be cooling off a bit in May, with 59 percent of Redfin offers facing competition in the first half of the month.
The Demand Index tracks millions of visits to Redfin.com and the touring and purchase offers of thousands of Redfin customers in 15 major metro areas. The index equaled 100 on January 2013, the first month of the estimation period, and is adjusted for changes in Redfin market share.
