The new housing crisis is so bad that buyers are increasingly rushing to bid on places they’ve never seen

source
Steve Dipaola/Reuters

  • About one-third of people who bought homes last year said they had made offers on houses they hadn’t yet seen, a recent survey by Redfin found.
  • The finding is a sign of how heated the race to make the fastest and most attractive offer has become.
  • There’s a housing-supply crisis in many metro areas where builders are unable to keep up with the pace of demand.

The tight US housing market is prompting numerous homebuyers to bid before they’re able to see the properties in person, a survey conducted late last year by Redfin found.

Last year, 35% of people who bought a home made an offer sight unseen, the survey found, up from 33% polled in May and 19% surveyed in June 2016.

The most recent finding shows how heated the race to make the fastest and most attractive offer has become.

Because builders are unable to keep up with the pace of demand, housing markets in many US cities are tight – except at the luxury end. And though homeowners trying to upgrade may be able to sell quickly, they often hesitate knowing they’ll face a much tougher buyer’s market, leading to even fewer homes available for sale.

Millennials were much more likely than older homebuyers to make offers sight unseen, the survey found. Redfin’s Greg McCarriston, who wrote the report, said this was partly because the younger demographic tends to have more faith in what they see when shopping online. Remote shoppers also relied on agents to conduct live video tours and for advice on details like school districts and neighborhoods.

The survey found that 57% of homebuyers surveyed in Los Angeles made an offer sight unseen, while that figure was 46% in San Diego and 44% in San Francisco.

“Demand is relentless despite all of these headwinds homebuyers should be facing in terms of low inventory competition and high prices,” Cheryl Young, a senior economist at Trulia, told Business Insider. “I think we’ll actually see demand continue going up this year.”