Buyers needing financing or insisting on inspection still competitive
October 5, 2021, 4:48 pm By RealTrends
Nearly one quarter of U.S. home sellers received four or more offers on their home in 2021, according to Zillow’s latest consumer housing trends report.
The rise in the number of homes that received multiple offers is reflected in the increased frequency of bidding wars in 2021. Typical sellers received two offers, which is the same as the past three years.
The report, which was based off of data collected by Zillow Group Population Science through a national survey of more than 2,000 sellers, also found that the percentage of offers that fell through was slightly higher than in years past, with 56% of sellers reporting that none of the offers on their property fell through compared to 58% in 2020. The median number of offers that fell through, however, remained at zero for the fourth year in a row.
Most sellers (74%) received at least one offer on their property that was all cash or did not include a financing contingency. This is slightly higher than the number of buyers who reported purchasing a home without a mortgage (68%). This discrepancy suggests that buyers who need financing can still compete with cash offers, as long as their offer is appealing in other ways.
One such way a buyer could make their offer more appealing is by waiving an inspection. In 2021, 65% of sellers reported that they received at least one offer that waived an inspection, but 88% of successful buyers said they got an inspection prior to finalizing their home purchase. Only 16% of homes sold in 2021 underwent no inspections from potential buyers, according to the report, a clear sign that buyers who insist on an inspection are still competitive.
Overall, sellers were typically white (72%) and selling in suburban areas (51%) in the South (41%). Only 10% of sellers were Black, while Latinx and AAPI sellers made up 8% and 6% of all seller, respectively.
Nearly 80% of sellers said that a life event influenced their decision to sell their home, with 46% citing a change in their household or family size as their main reason for moving. About two-thirds of sellers (65%) also reported buying a home.