Report: More Greater Boston homes are going for above the asking price
In metro Boston, 40.1 percent of the homes that sold in September went for above the asking price.
SEATTLE — In more evidence that persistent buyer demand is pushing a strong housing market deeper into the year than usual, a new Zillow analysis finds that the share of homes sold above the list price continues to rise, blowing past the typical midsummer peak. That is great news for prospective sellers who want to maximize their return from a potential home sale.
In September, 22.4 percent of homes purchased in the United States were sold for more than their initial list price, up from 20.2 percent in August and well above the roughly 15 percent of homes that did so during September 2018 and 2019. It is highly unusual for the share of homes sold above the listing price to continue rising this late in the year. In both 2018 and 2019, the share peaked in July during the height of the typical home shopping season before steadily declining as the market cooled in the fall and winter months. This year, the share has increased each month.
In metro Boston, 40.1 percent of the homes sold in September went for above the asking price, typically going for $25,117 more than what they were listed for, according to the report. That’s up from 27.6 percent a year earlier. The most-sought-after homes are in the lower-middle fifth of the market, between $369,887 and $481,647.
Buyer demand across the United States has been intense and persistent since the market picked up speed in April after a dramatic slowdown in the early days of the coronavirus pandemic. Potential buyers may be feeling an urgency to lock in low mortgage rates now, especially if they sense prices will slip further from reach in coming years. Many others may be taking advantage of newfound freedom to telecommute from an area where they can more easily afford a home.
Whatever the reason, strong demand is helping to keep a lid on inventory as homes are being snatched up faster than sellers are listing them. Inventory has continued to fall compared with last year — down 37.4 percent year over year at the end of October — even as new listings have returned to near last year’s level, an indication of heavy sales volume. Homes were typically selling after only 12 days, a full 17 days faster than the same time last year. Those market dynamics are likely pushing buyers to make offers above list price, as they expect quick sales and competition from other buyers while choices are limited.
‘‘The housing market is taking us all back to Economics 101 and teaching lessons about supply and demand,’’ said Chris Glynn, Zillow senior economist. ‘‘A persistent interest in buying and moving is creating an imbalance that is driving prices higher than we typically see at this time of year. In many cases, buyers in this market should be realistic about the chance of bidding wars and leave themselves financial flexibility by looking at homes listed for less than their maximum price point. With tight inventory, low interest rates, and robust demand from households re-evaluating their housing needs, a strong, competitive market with many transactions is likely here to stay into 2021.’’
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