Redfin has launched a new feature called Compete Score to help home buyers better understand what they’re up against when it comes to beating out other interested parties in a particular city or neighborhood. And, to no one’s surprise at this point, Seattle ranks as one of the three most competitive cities in the U.S. on the new tool’s scale.
In a range of 0 to 100, with 100 being the most competitive, Seattle joins the California cities of Fremont and San Jose as the most difficult places to win in the home buying sweepstakes.
According to Redfin, Compete Score is primarily calculated based on four inputs: number of competing offers, waived contingencies, sale to list ratio, and number of days on market. The range of scores is similar to how the Seattle-based real estate brokerage compiles its Walk Score, a ranking for the walkability of any particular address.
The Seattle Compete Score page sums up the city’s real estate climate like so:
- Homes typically receive six offers.
- Homes sell for about 7 percent above list price and go pending in around seven days.
- Hot Homes can sell for about 15 percent above list price and go pending in around five days.
“Many of the most competitive cities are tech hubs that have attracted an influx of people moving to the area for jobs, unmatched by the creation of new homes,” Taylor Marr, senior economist at Redfin, said in a blog post. “This has led to intense competition and rising home prices. In San Francisco, Seattle and Denver, homes have become so expensive that many people are moving elsewhere in search of more affordable and less competitive housing markets.”
Moving 30 minutes south to Tacoma, Wash., won’t do much good. With a Compete Score of 95, the city is just below San Francisco and ahead of Denver and Boston.
In the Seattle area, four neighborhoods, including Phinney Ridge, are among a cluster of six which all rank as No. 1 in the country for most competitive score of 100. The neighborhoods all had at least 25 home sales in the past three months.
“Even with the recent–and much needed–surge of inventory, desirable homes are under contract in five to seven days,” said Shoshana Godwin, a Redfin agent in Seattle. “That actually feels to us like a long time, but when you put it into perspective with the market nationally and historically, Seattle remains very competitive. Last week, I wrote an offer on a home that had five other offers, escalating up to $150,000 above the asking price.”
A Redfin agent in New Orleans said that she often works with clients who are relocating to that city after being priced out of tech-heavy markets such as Seattle and Silicon Valley. New Orleans leads a list of the least competitive cities in the U.S. with a score of 43.
“They’re relieved to find we have a healthy, relatively affordable housing supply and that homes typically remain on the market for about two months before going under contract,” said Redfin agent Caren Morgan.
Visit the Redfin site to use the Compete Score tool and learn more about the methodology.