One in Three Buyers Makes Offers on Homes Sight UnseenApril 20. 2018 law
It may be hard to believe, but about one in every three homebuyers now makes offers on homes before they’ve seen them in person. According to the results of a recently released Redfin survey conducted last year, 35% of homebuyers made offers on homes sight unseen in 2017, which was up by 2% from 2016 and 16% from 2015. And according to Redfin, the trend is expected to increase in 2018.
Who’s Buying Homes Without Seeing Them?
According to the survey, millennials were more likely to buy homes without seeing them in person than homebuyers from other generations. More than 40% of millennial homebuyers in 2017 said they made offers sight unseen.
Foreign investors buying homes from afar are also believed to be partially responsible for the high numbers of buyers making offers sight unseen in some metros. Los Angeles is a prime example. In that city, 57% of successful buyers said they made an offer on a home without first seeing it in person.
How Are They Deciding on Homes?
Those who are making offers on homes before seeing them are using multiple listing service (MLS) descriptions, photos and virtual tours on the Internet, as well as advice from real estate professionals when making their decisions.
What Is Behind the Trend?
Very strong competition for too few houses on the market is one of the main reasons for the increase. According to a recent article in USA Today, the market is so fierce right now that it’s causing some buyers to take desperate measures, especially in the markets that are the most competitive and where homes sell the fastest.
For example, not only are buyers making offers on homes sight unseen, but in some instances, they are also skipping home inspections and leaving contingencies out of their contracts. Not only that, but many are also bidding well above the asking prices in hopes of winning the sellers’ acceptance.
Although this may not seem very smart, it makes sense when competition is so stiff and homes sell super fast. The median time for a home to stay on the market in the nation now before it sells is just over two months, but in some markets, they sell on average in less than two weeks.
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