“Laurie’s prior experience in real estate and the mortgage businesses are invaluable,” said James Marks, Redfin’s Atlanta Market Manager. “She is an awesome negotiator and she has a deep understanding of the short sales and foreclosures that make up the bulk of our current market. Our clients who get to know her absolutely love her. I couldn’t be more proud of Laurie and her accomplishments.”

We’re thrilled to see Laurie’s hard work and dedication to her clients recognized on this market-wide ranking. Laurie embodies Redfin’s values of putting the customer first, standing by their side, and most importantly getting them the best deal possible. Much like Redfin, NeighborCity is committed to transparency, providing home buyers and sellers with a database of agent information and ranking them based on their transaction history and number of active listings. A look through Redfin profile page complete with reviews from her past customers completes the picture of the high level of service Redfin’s customers receive when they work with Laurie and her team.

Congratulations, Laurie!

Where did we find the moldiest basement ever? Chicago.

Where did we stumble upon this sleeping man? Chicago.

Where did we discover this message-on-a-staircase? Chicago.

Whose property is this tree? Chicago’s.

Do your business in a jungle in the comfort of your own home, in Chicago.

Vintage arcade games seem to be an emerging trend in Chicago real estate. Yes, all of these were found inside Chicago area homes:

It’s on like Donkey Kong!

Captain Fantastic: The Brown Dirt Cowboy

Mario and Luigi: Your new roommates?

What’s a basement without Pac-Man?

Since launching our Austin market in April, more than half of the offers Cyndy has written have been faced with competition from multiple offers, many of them escalating above the asking price. Just this week, Redfin’s Real-Time Price Tracker indicated that in May, Austin saw one of the nation’s strongest home price gains of 7.8% year over year.  “It’s a result we expected to see in the wake of the low inventory and bidding wars that we continue to face day in and day out,” said Cyndy.

Cyndy has proven that she’s not just a competitor, but a fast-acting and creative one too. One of our very first sets of Austin clients fell in love with a hot property while they were touring it with Cyndy. Armed with her Redfin-issued iPad, Cyndy and her clients wrote, signed and submitted the offer on the spot. Theirs was the first one in, and it was accepted! Cyndy described another situation in which she found herself at the courthouse downtown for a bankruptcy hearing that turned into “an all out action-style bidding war. My client lost out to two cash buyers with higher offers,” said Cyndy.

The local media has caught wind of the feeding frenzy on Austin homes, and Cyndy has made us proud as our local spokeswoman, telling the Austin Statesman how nuts it is out there for buyers in today’s seller’s market, and describing the droves of people she regularly finds queued up to get in to see hot new homes on the market on KVUE.

For a complete picture of the Austin area market’s most recent stats and trends, download the Redfin Market Report here: Redfin-Austin-Real-Estate-Market-Report-May-2012.

Bidding wars aren’t fun, and we have no one and nothing to blame but the inventory shortage we’ve been seeing for the last several months.  We measure inventory based on months of supply (the number of homes for sale divided by the number of homes sold in a given time period).  Six months’ supply represents a balanced market, whereas anything less than that makes for a seller’s market.  In April, Baltimore County’s inventory weighed in at five months’ supply.

So what can you do to survive today’s market?  For sellers, pricing is key.  “If you price it to sell and it shows really well, it’ll be gone,” said Lynn Ikle, David’s agent. “If you think, ‘I’m going to take advantage of this market,’ and overprice it, it’s going to sit.”

For buyers, making the highest offer is important, but it’s all about knowing what the seller wants and giving it to them. Lynn’s clients buying in Stoneleigh recently beat out two other offers because they offered to let the sellers stay in the home for two months after closing—rent free.

We’ve got a slew of other bidding war strategies to arm yourself with, from offering all-cash when you can, to hand-delivering the offer complete with a personal letter explaining why you and your family are most deserving of the house. Read our blog post about how to win bidding wars and went to back away, join us for our next Competitive Offer Webinar on June 5^th, or get in touch with an agent to get started.

For a complete picture of the Baltimore and Washington, D.C. area markets’ most recent stats and trends, download the Redfin Market Reports here: Redfin-Baltimore-Real-Estate-Market-Report-April-2012; Redfin-Washington-Real-Estate-Market-Report-April-2012.

“Nearly every offer I’ve written in the last two months has gone into a bidding war,” said Cambridge/Somerville Agent Matt Zborezny, “The best piece of advice I have for my clients is to pull out all the stops you’re willing to pull.”

“What’s frustrating for the average home-buyer is that a lot of the buyers and investors you’ll find yourself up against are willing to offer tens of thousands of dollars above the asking price, often for all-cash, and remove inspection contingencies, which we wouldn’t normally recommend doing,” said Matt. “I’m optimistic that over the next few months, the appetites of the less risk-averse buyers and investors will be satisfied, and there will be more opportunities for regular home-buyers to win out with more standard offers.”

For a complete picture of the Boston area market’s most recent stats and trends, download the Redfin Market Report here: Redfin-Boston-Real-Estate-Market-Report-April-2012.

Another explanation for fewer closings is that more deals are falling apart at the last minute because the loans can’t be approved. Our team recently saw two deals fall apart in the late stages of underwriting when the lenders and underwriters uncovered previous loan defaults in the buyers’ records, and not enough time had passed since for them to be able to get another loan.

“Unfortunately, they worked with lenders who were from out of town, or whom we didn’t know,” said JD Pulice, Redfin Long Island agent.  “The lenders had pre-approved the buyers for the loans, but it wasn’t until the final underwriting stages that they uncovered these blips on the buyers’ records.”

Choice of lender is the buyer’s to make, and we make that choice a little easier by recommending local lenders who have proven track records of putting the customer first and getting the deal done every time. One of the reasons we recommend Redfin Certified lenders is that they do the due diligence of detailed loan background checks before writing a pre-approval letter to avoid surprises like this later on.

“I have a few clients now who have been 30 days late on a loan payment in the last 12 months and had no issue getting a loan, but any delinquency later than that, and they simply won’t get approved,” said Frank Virga of Quality Financial Solutions.  “When I see anything more than a 30 day lateness in the last 12 to 24 months, I know there is going to be an issue when it gets to underwriting, and I will not pre-approve the client for a loan because I don’t want to waste their time or anyone else’s.”

Frank explained that there are some exceptions to the rule: For example, FHA loans allow for an explanation of derogatory credit with a chance that the loan can still be approved depending on the circumstances.

“I recently ran into a former client who mentioned that he was getting ready to short sell his house and buy a new one,” said Dawn Sullivan of All Shores Mortgage. “I caught him off-guard when I told him he’d have to wait at least two years after a short sale to get a new loan.”

Depending on loan type and down payment, the rules regarding how long you have to wait before getting a new loan after a short sale or foreclosure vary.  Dawn broke them down for us:

We encourage home-buyers to speak to a lender early in their home search process to get pre-approved for a loan.  At this point, it’s important to make sure that your lender is doing all the necessary checks not only on your credit score, but also your borrowing history, not only to determine how much money you can borrow, but also to ensure that if you’ve had an issue in the past, enough time has passed for your loan to be approved today. While it’s often overlooked or rushed through, the pre-approval step is important in helping you set expectations for your home purchase and avoiding frustration down the road.

For a complete picture of the New York area market’s most recent stats and trends, download the Redfin Market Report here: Redfin-New-York-Real-Estate-Market-Report-March-2012.

Austin should be a perfect market for us, with plenty of real estate innovators, lots of progressive consumers, lots of weirdness, and plenty of technology to boot. We like Austin’s size too, as Redfin has already thrived in places like Portland and Boston, where the territory is a little easier to cover.

Redfin’s Austin business is led by superstar Cyndy Stewart, who has eight years of local experience. Cyndy is building a team of four folks to serve Austin, covering all of Travis and Williamsoncounties, as well as the towns of Wimberley and Dripping Springs in Hays County, south of Austin.

In all of these places, we’ll continue to give customers a choice of partner agents, too, especially where we still aren’t local or when we get too busy. For most of Hays County as well as Bastrop County, we’ll rely exclusively on partners.

For us, combining direct and partner service is the only way to build a balanced business, able to serve new customers in any neighborhood at the drop of a hat, without hiring more agents than we can support year-round, through thick and thin. That hasn’t changed.

What is new with Austin is that we waited 18 months to hire our own agents. Waiting is much better for customers than the old Redfin model. For example, when we launched Atlanta the old way in December 2009, we hired one guy to scramble around central Georgia, which is about seven times larger than Austin.

That one Atlanta guy spent his life driving and hoping for more business. Since it took time for Redfin’s traffic to grow, we didn’t have enough customers to justify a larger team. But almost nobody wanted to work with an agent trying to cover all of Atlanta, so customers were hard to come by too. It was a classic chicken-and-egg problem.

The solution we developed for Austin is the chicken then the eggs, launching a website and monitoring the traffic before deciding to hire agents in force. We’ve always been clear about this plan in Austin, yet beginning first as a website that referred customers to partners naturally raised a ruckus among real estate brokers. It’s a privilege to be a broker in Austin, and to participate in the local Multiple Listing Service used to share listing data.

At a conference in Austin just a few months ago, some of Austin’s thought leaders asked me how can we claim to make real estate better if we’re just another online middle-man, coming between the agent and his customer? Everyone in technology worries Redfin  will simply be a service business, and everyone in real estate worries we’ll simply be a web business. The truth is that we go back and forth, not because we can’t make up our mind, but because it’s the best way for us to serve our customers.

We’ll see how it works out in Austin. I bet it’ll be a smash hit. If you’d like to meet the new Redfin agents or our long-standing Austin partners, we’re having everyone from the local real estate scene over for a little party on May 2, with lots of Redfin execs flying into Austin from Seattle, and an engineer or two as well. Welcome Cyndy and howdy Austin!

What’s keeping would-be sellers from unleashing much needed inventory onto the market?  It could be that despite bidding wars driving prices up on individual homes, the price just isn’t right.  Many homeowners, especially those who are under water on their mortgages, are watching the trends in home prices and waiting to start to see a solid upward trend, but seeing prices continue to hover around year-long lows.

So what’s motivating those who are choosing to sell now?  Today’s sellers are the ones who feel most confident in the strength, and particularly the speed of the market.  During the first quarter of the year, 19% of Chicago-area listings sold within three days of their market debut.  If you’ve got a home to sell that’s in good condition, and we price it right, it will go quickly.  So for those looking to make a lot of money on a sale, now might not be the right time for you, but a motivated seller can really benefit from today’s bidding wars.  “Bidding wars can be stressful for sellers too. The last two open houses I held drew more than twenty groups of people and several offers for the sellers to choose from with pressure from the buyers who needed to know soon whether they won the home or should give up and move on,” said Redfin Chicago’s Listing Specialist Jenna Smith. “But today’s sellers tend to have the upper hand, with a choice of buyers and often the privilege of dictating the terms of the sale. In my last sale in Wicker Park, we were clear about the specific settlement date the sellers needed, so all four offers came in with that closing date and identical financing terms, within $2000 of each other. In the end, we went with the highest bidder.”

For a complete picture of the Chicago area market’s most recent stats and trends, download the Redfin Market Report here: Redfin-Chicago-Real-Estate-Market-Report-March-2012.

In March, 54% of the offers our team wrote ended up in bidding wars with prices literally rising before our agents’ and clients’ very eyes. While bidding wars are great for sellers, they can be very stressful and frustrating for buyers.   One of the problems is that appraisers just can’t keep up with the increasing purchase prices driven by all this demand.  Buyer, seller and their agents agree to a purchase price based on the best and most recent comps. Appraisers sometimes come in from out of town, and aren’t tracking the local market on a day-to-day basis like our agents are, so they often choose different comps, or don’t make some of the necessary price adjustments that agents have considered, often resulting in a low appraisal.  Since the seller knows he left three or four other close offers sitting on the table, it’s usually the buyer who has to bring the extra cash to the closing table if he wants to keep the deal together, or another buyer will.

To make matters worse, Boston has a relatively long closing cycle, with 45 to 60 days being the norm.  Sold prices aren’t reported until a deal closes, so even the newest comps appraisers have to work with are already two months old and not in tune with the hot market.  Because our agents are working in the same neighborhoods week after week, writing several offers a day, they have a very close pulse on home values and the market as a whole.

Back in mid-March, Peter Phinney, an agent on Redfin’s Boston team, helped his clients win a bidding war against three other offers on a house in Jamaica Plain.  Their winning offer was $16K over the asking price, and Peter hand-delivered it to the listing agent before the open house had ended. “We all knew that the appraisal could be an issue, and indeed it came back $10K under the agreed upon purchase price (but still $6K above asking). The problem was that there really were no good comps for this home. There just hadn’t been enough sales nearby in the last twelve months,” Peter said.

The buyers’ mortgage broker, Sofia Travayiakis stepped in and got in touch with the listing agent to go over the appraiser’s comps one by one.  Because Sofia is a well-respected local lender who knows the market, she was able to help both sides agree to a $10K price reduction to meet the appraisal value and get the loan approved. Peter emphasized, “The take-away here is that in a market this competitive, appraisal issues are becoming more and more common, and it has simply never been more important to choose a strong local team that can work together to advocate for you from beginning to end.”

For a complete picture of the Boston area market’s most recent stats and trends, download the Redfin Market Report here: Redfin-Boston-Real-Estate-Market-Report-March-2012.

The data below are the main trends for the City of Los Angeles, but you can see the housing market data for the entire LA area here.

The perfect storm for sellers in LA

Buyers? They’re definitely hungry in LA. March saw a 24.6% spike in home sales from February, making it one of the most active months in the last year for home sales.

Sellers? The extraordinarily few home sellers out don’t have to worry about much competition. Inventory in the city of LA in March was down 16.7% from February, and down 38.7% from last March. That’s the lowest we’ve seen in the last year. When you combine the fast pace of sales with the low number of homes for sale, we’re seeing a lot of competition, bidding wars, fast sales and frustrated buyers.

In fact, of LA-area cities with more than 100 homes for sale, only one showed monthly growth: Inventory in Beverly Hills grew 0.4%, from 263 homes for sale in February to 264 homes in March. Even still, inventory there was down 29.8% year over year.

Prices stay put

Even with the increased demand, buyers aren’t ready to pay much more to buy a home in the LA area. The median single-family home price is up 5% month over month, and 0.6% year over year to $355,000. Condos moved a bit more, with a median price increase of 5.5% month over month to $290,000. If the inventory freefall continues, buyers will have to make a choice: Offer more money, or stay on the sidelines.