Homebuyers who offered cash were a whopping 334 percent more likely to win a bidding war than those who chose to finance their purchase, according to a report from Redfin released Monday.

When it comes to bidding wars, cash is king according to a new report released Monday from Redfin.

Homebuyers who offered cash were 334 percent more likely to win a bidding war than those who choose to finance the purchase, while those who waived the financing contingency and conducted a pre-inspection were 31 and 25 percent more likely to win bidding wars, respectively, according to the report.

With historically tight inventory leading to a new high in bidding wars amid the spring homebuying season, it’s more important than ever for buyers to know what strategies will help them come out on top.

January 2022 is on record as the most competitive month recorded by Redfin, with 70 percent of homes handled by Redfin agents resulting in bidding wars. Last year saw 30 percent of homes sell above list price, while the most recent data shows 43 percent of homes sold above list price in February 2022. 

While some predictions saw bidding wars fading as more inventory came online, the market is now mired in uncertainty.

Agents should be prepared to coach their clients through the bidding war process and prepare them for the price escalating significantly above asking, the report states.

“I let buyers know what to expect and try to prepare them, financially and emotionally. The home they’re touring will probably sell for significantly over asking price,” Fort Worth, Texas-based Redfin agent Amanda Peterson said in a statement.

It’s also up to agents to advocate for their clients, according to the report.

“If a buyer has a low down payment or another scenario that doesn’t typically win a bidding war, I’ve had success explaining buyers’ unique situations to the listing agent and making it clear that their finances are reliable and the deal will close,” Peterson said.

Buyers who are unable to make a cash offer may also want to consider other strategies like waiving the financing contingency and conducting a pre-inspection to make their offer stand out, according to the report.

Email Ben Verde

 

Redfin
Show Comments Hide Comments

Comments

Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Did you miss Connect Now yesterday? Register now and get instant access to all the replays! Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription