Concerns are rising about the potential for a nationwide housing market crash, especially on the West Coast. At least for the moment, a new report suggests that market remains as hot as ever.
The booming technology sector that attracts scores of well-paid workers have driven up home prices — resulting in stiff competition for people trying to put bids on houses in key areas, according to a recent report by Redfin, a Seattle-based real estate brokerage.
In fact, most homeowners are getting multiple offers, and those units move within a week or less of going on sale, Rachel Musiker, a Redfin spokeswoman, told CNBC.
“For buyers, competition is challenging,” Musiker said. “To win, they will likely have to raise their offer price and waive contingencies and it might take several months and several bidding wars before they find success.”
Buyers are often compelled to yield to bidding wars — offering prices considerably higher than the asking rate — in order to outdo each other, Musiker said. This results in a overall surge in home prices.
Cities like Aurora, CO and Sacramento, CA are not tech hubs, but are within commuting distance from the Bay Area. For that reason, even places outside Silicon Valley’s immediate vicinity seeing a surge in competition from workers in search of affordable homes, Musiker said.
Below are Redfin’s top six cities with a population of at least 200,000, ranked according to their competitiveness. A score of 90-100 indicates cities where houses on the market are “most competitive,” and often receive multiple offers per unit.
