Homebuyer bidding wars heat up 1Q of 2020: Redfin
Here’s a quick recap of Redfin chief economist Daryl Fairweather’s 2020 predictions on home prices and bidding wars. A bidding war is when multiple buyers are writing offers on the same property, and here are some bidding war tips. Below are Fairweather’s notes on bidding wars. Also adding another of her 2020 predictions home values in hispanic neighborhoods rising faster than in white neighborhoods. Link to all her predictions below that (or click the image).
HOMEBUYER BIDDING WARS WILL HEAT UP IN Q1 2020
Low mortgage rates, fewer homes for sale, and people staying put longer will drive this.
In 2020 there will be fewer homes for sale than in the past 5 years.
More demand and less supply means bidding wars will rebound in the first quarter.
Fairweather expects about 1 in 4 offers to face bidding wars in 2020 compared to only 1 in 10 in 2019.
She says this increased competition will push year-over-year price growth up to 6% in the first half of the year, which is considerably stronger than the 2% growth seen in the first half of 2019.
Then she said price growth will moderate to 3% as more listings of new and existing homes hit the market later in 2020.
HISPANIC HOMEOWNERS WILL LEAD ON HOME EQUITY WEALTH GAINS
Fairweather predicts that Hispanic Americans will, for the first time, gain more home equity than white Americans in the next 10 years.
Why? Because the majority of new homeowners are Hispanic, and home values in Hispanic neighborhoods are increasing faster than in white neighborhoods.
Fairweather says there are more Hispanic homeowners in Texas than in any other state and Texas cities are likely to experience strong gains in home values over the next decade as people move here from more expensive places like San Francisco and Los Angeles.
She said Hispanic Americans could tap their home equity to finance their children’s education or to start businesses.
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Reference:
– Redfin Chief Economist Daryl Fairweather 2020 Housing Predictions