Cities with highest home sales exceeding listing prices

Would you be willing to pay $200,000 over an already sky-high seven-figure asking price for the privilege of living in a house where a murder took place?

As strange as this sounds, this is what happened recently in Santa Clara, CA, where a property was sold for $2.1 million mere months after news surfaced that a Google engineer killed his wife there.

While a $200,000 premium for such a property might seem extreme, it’s also a prime example of how certain markets in America face such a housing shortage that just about any house will get a deluge of offers—many well over the list price.

In addition to location, timing matters. During the turbocharged, low-interest-rate housing market of the COVID-19 pandemic, bidding wars pushed prices well past what sellers had ever hoped to get.

“The U.S. saw homes sell for the most over asking price in May 2022 when the typical home sold for 3.1% over asking,” says Realtor.com® senior economic data analyst Hannah Jones.

In today’s much more sluggish, higher-rate environment, however, these staggering offers have ebbed.

“The typical U.S. home has sold for less than asking since August 2022,” says Jones. “In the first half of 2024, the typical U.S. home sold for 1.9% below asking price.”

Nonetheless, as Santa Clara’s pricey murder house makes clear, certain markets are still hopping with bids. And since knowing where these places are can help you ace whatever your home goals are from buying to selling, we’re here to point out these cash cows so you can act accordingly.

To calculate the areas where home sellers are getting the most over asking price, Realtor.com looked at the sale-to-listing price ratio for the 75 largest U.S. metros.

“The areas where homes are selling the most over list price are mostly located in the Northeast and the West,” says Jones. “Metros in the California Bay Area, such as San Jose and San Francisco, are notoriously competitive, requiring buyers to offer a highly attractive purchase price to win out against other hopeful shoppers. Though inventory has climbed annually in the area, there are still fewer homes for sale than was typical pre-pandemic, cranking up competition another notch.”

San Jose comes in as No. 1 in these rankings with homes selling for 6.2% over asking.

Brad Gill, a broker and owner of NextHome Lifestyles who has worked in the area for more than 20 years, says San Jose’s geography—bordered by the San Francisco Bay and in a valley—makes it difficult for the market to grow.

“It creates a situation where you have really well-paid technology employees who receive large bonuses in stock purchase programs,” he says. “And they’re all competing for a very constrained amount of inventory.”

Gill adds that San Jose's market has significant seasonality: There are typically fewer homes on the market in Q1 of each year leading to greater competition among available homes. Overall inventory has also been lower due to higher interest rates which have kept homeowners "locked in," according to Gill.

Yet buyers can take heart that while homes are selling above asking prices in cities like San Jose they might not be selling above market value.

“A lot of these properties are being listed at 3% to 5% below what they would comp out at to be more competitive,” says Gill.

While paying over asking may seem common only in wealthy cities like New York or San Francisco seven out of ten top markets where sellers get above asking have median prices below $500K.

Three such markets lie within Connecticut which Jones attributes to buyer competition driven by commuting proximity to New York City and Boston especially as employers require workers back at least part-time onsite.

“The Northeast metros where homes sold most above asking this year have seen high buyer demand and quick market pace due largely to their location within commuting distance from major economic hubs," Jones explains." Buyers face low inventory and high competition hence must present their best offers upfront."

Here is an overview:

San Jose (CA) - Median Price: $1.3M; Over Asking: 6.2%

Hartford (CT) - Median Price: $210K; Over Asking: 4.8%

Kansas City (MO) - Median Price: $260K; Over Asking: 4.3%

San Francisco (CA) - Median Price: $1.15M; Over Asking: 3.6%

Buffalo (NY) - Median Price: $220K; Over Asking: 3.1%

New Haven (CT) - Median Price: $350K; Over Asking: 2.7%

Bridgeport (CT) - Median Price: $375K; Over Asking: 1.9%

Worcester (MA) - Median Price: $499K; Over Asking: 1.6%

Richmond (VA) - Median Price: $379K; Over Asking: 1.3%

Boston (MA) - Median Price:$949K; Over Asking :1 .1%