The following is an excerpt from an article written by:
Mike Rosenberg -The Seattle Times – UpdatedJun 5, 2016
“In today’s ultra competitive local housing market, there are now more home-bidding wars than at any point this decade. The result? For the first time during the economic recovery, the majority of homes are selling for above the list price in Seattle and surrounding cities.”
“It’s an inescapable reality from West Seattle to the Eastside: A dozen or more families and investors may vie for the same house. Then an onslaught of offers pushes the bidding far above the list price, sometimes hundreds of thousands of dollars more. Whoever wins often has to plunk down huge, nonrefundable cash sums before even getting to inspect the property.”
“It’s a jungle out there,” said Lauren Haule, whose family recently spent a year “on an emotional roller coaster” looking for their first home on the Eastside, only to lose about a dozen different bidding wars. “People were just going in with these really high numbers to the point where the asking price started to not really mean anything anymore.”
“The Seattle metro area now sees a higher rate of bidding wars than any other high-priced market outside of the Bay Area, and the trend is growing. Across the region, about 75 percent of homes have received multiple offers so far this year, up from 55 percent four years ago.”
“The crowd of bidders helps push prices higher: Now, 56 percent of homes sell for more than the asking price — more than double the national average and up from 26 percent in Seattle four years prior.”
“The reason for all the high-stake auctions is simple: There are way more well-qualified buyers than homes for sale.”
“When a desirable house comes on the market, I think there is a feeding frenzy around it,” said Aamer Hydrie, a single dad who spent more than a year trying to buy a house in Seattle and kept getting outbid. “You’re sort of in this pressure cooker where time is ticking and you think things are only going to get more expensive. You have this sense of urgency.”
“The trend has several implications beyond the crushing toll it takes on homebuyers (and the sweet, quick profits generated for sellers).”
“Agents are working late at night, often arranging tours and submitting bids the instant a prime home goes on the market, in an attempt to beat the expected flood of offers. The rapid nature of the auctions means buyers sometimes aren’t fully sure what they’re getting until after the deal is closed…”
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