W
ould you be willing to pay a premium of $200,000 for the privilege of living in a house where a murder took place? Recently in Santa Clara, CA, 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. However, in today’s much more sluggish, higher-rate environment, these staggering offers have ebbed. The typical U.S. home has sold for less than asking since August 2022, and in the first half of 2024, the typical U.S. home sold for 1.9% below asking price.

    Despite this, certain markets are still hopping with bids. San Jose comes in as No. 1 in these rankings, with homes selling for 6.2% over asking. The city's geography—bordered by the San Francisco Bay and in a valley—makes it difficult for the market to grow. This situation creates a situation where you have really well-paid technology employees who receive large bonuses in stock purchase programs, competing for a very constrained amount of inventory.

    Buyers can take heart that while homes are selling for over asking prices in cities such as San Jose, they might not be selling for over-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.

    The median price of homes in seven of the top 10 markets where sellers get over asking is below $500,000. Three of those markets are in Connecticut, a fact that Jones attributes to buyers competing to be within commuting distance of New York City and/or Boston—especially as more employers are requiring workers to return to the office at least a few days a week.

    The top 10 where homes fetch the most over the asking price are:

    1. San Jose, CA - Median home price: $1.3 million - How much homes sell for over the asking price: 6.2%

    2. Hartford, CT - Median home price: $210,000 - How much homes sell for over the asking price: 4.8%

    3. Kansas City, MO - Median home price: $260,000 - How much homes sell for over the asking price: 4.3%

    4. San Francisco, CA - Median home price: $1.15 million - How much homes sell for over the asking price: 3.6%

    5. Buffalo, NY - Median home price: $220,000 - How much homes sell for over the asking price: 3.1%

    6. New Haven, CT - Median home price: $350,000 - How much homes sell for over the asking price: 2.7%

    7. Bridgeport, CT - Median home price: $375,000 - How much homes sell for over the asking price: 1.9%

    8. Worcester, MA - Median home price: $499,000 - How much homes sell for over the asking price: 1.6%

    9. Richmond, VA - Median home price: $379,950 - How much homes sell for over the asking price: 1.3%

    10. Boston, MA - Median home price: $949,950 - How much homes sell for over the asking price: 1.1%