Limited housing inventory has caused a series of issues for buyers looking to find the right home. Now, buyers are just looking to take advantage of low-interest rates, scooping everything up off the market. Redfin reported a record 52% of homes went under contract within two weeks. This comes as median home prices are rising while pending home sales increase and new listings decrease.
"52% of homes that went under contract had an accepted offer within the first two weeks on the market, well above the 43% rate during the same period a year ago," according to the report.
"This is the first time the four-week average has surpassed 50% since at least 2012 (as far back as Redfin's data for this measure goes)."
The asking price of newly listed homes hit a new all-time high of $334,770, up 10% year-over-year, according to the report. Additionally, pending homes were up 29% year-over-year for the four-week period ending Feb. 7, 2021. New listings fell 11% from 2020 and active listings dropped 37% from 2020 to a new all-time low.
"There is a serious lack of new listings, and although prices are through the roof, homeowners are reluctant to sell, because it's so hard to buy again unless you are moving to a less expensive area where you can afford to outbid other buyers," said Redfin chief economist Daryl Fairweather. "Sellers who are concerned about finding their next home are asking buyers for a rent-back agreement, which allows the seller to stay in the home until they can move into their next one. Offering a rent-back agreement can also be a winning strategy for buyers with flexible timelines."
Meanwhile, the seasonally adjusted Redfin Homebuyer Demand Index—a measure of requests for home tours and other services from Redfin agents—was up 63% from the same period a year ago.