Multiple-bid offers becoming more prevalent as
WALTHAM, Mass. – April 18, 2013 – The Massachusetts Association of REALTORS® (MAR) reported today that both the REALTOR® Market Confidence Index (RMCI) and the REALTOR® Price Confidence Index (RPCI) hit all time highs in March. With the number of homes for sale declining, REALTOR®-members who responded to the survey said they are seeing an increase in multiple-bid offers, but that single-bid offers are still just as common.
“Confidence in the real estate market and home prices by REALTORS® pushed the Market and Price Confidence Indexes to new heights in March as a sellers’ market begins to emerge,” said 2013 MAR President Kimberly Allard-Moccia, broker-owner of Century21 Professionals in Braintree. “Right now multiple-bid offers are about as common as single-bid offers, but that could change as inventory continues to go down.”
In March 2013, the REALTOR® Market Confidence Index was 75.52, which was up 52 percent from the March 2012 score of 49.54. This is the second straight all-time high for the RMCI and the 20th straight month of year-over-year increases. On a month-to-month basis, the March RMCI was UP five percent from the 71.82 score in February 2013. Measured on a 100-point scale, a score of 50 is the midpoint between a “strong” (100 points) and a “weak” (0 points) market condition.
The REALTOR® Price Confidence Index was 78.74 in March, which was up 36 percent from the March 2012 RPCI of 57.73. This is the 14th straight month of year-over-year increases and another all-time high. On a month-to-month basis, the RPCI was UP 13% percent from the February 2013 RPCI of 69.55.
REALTOR®-members were asked about how prevalent multiple-bid offers were in 2013 (through March) because of the lack of inventory. Of those REALTORS® who responded to the survey, 37 percent answered all of my transactions (8%) or most of my transactions were multiple-bid offers (29%). Twenty-eight percent answered that an equal number of my transactions were multiple-bid and single-bid offers. While 35 percent answered all of my transactions were single-bid offers (9%) or most of my transactions were single-bid offers (26%)
About the REALTOR® Index Methodology:
The Massachusetts REALTOR® Market Confidence Index (RMCI) and Price Confidence Index (RPCI) are based on monthly responses from a random sampling of Massachusetts Association of REALTORS® members on the state of the housing market. More specifically, the survey asks members two basic questions pertaining to the real estate business in their market area in Massachusetts.
1. How would you describe the current housing market?
2. What are your expectations of home prices over the next year?
In addition to these standard questions, the survey each month includes one wildcard question that changes each month and is based on an industry hot topic.
The RMCI is calculated in the following way. Respondents indicate whether conditions are, or are expected to be “strong” (100 points), “moderate” (50 points), and “weak” (0 points). The results are the average score for each question. A score of 50 is the threshold between a “strong” and a “weak” condition. Similarly, the question about home prices over the next year (REALTOR® Price Confidence Index) is calculated using five categories: “Rise 0-5%” (75 points), “Rise 5%+” (100 points), “Level” (50 points), “Fall 0-5%” (25 points), and “Fall >5%” (0 points).
About the Massachusetts Association of REALTORS®:
Organized in 1924, the Massachusetts Association of REALTORS® is a professional trade organization with more than 19,000 members. The term REALTOR® is registered as the exclusive designation of members of the National Association of REALTORS® who subscribe to a strict code of ethics and enjoy continuing education programs.
*Please note, starting with the release of the September 2012 Index data, the REALTOR® Market Index will be renamed the REALTOR® Market Confidence Index and the REALTOR® Price Index will be renamed the REALTOR® Price Confidence Index.
Editors and reporters: Please note that the term Realtor is properly spelled with an initial capital “R”, per the Associated Press Stylebook.