January was the most competitive month on record, according to a new Redfin report. 

Seventy percent of offers written by Redfin agents faced bidding wars last month, an increase of 67.7% from December and up 61% from last year. 

January’s housing market was more competitive than ever as buyers rushed to make offers before mortgage rates jumped further, according to the report. 

At the end of January, the average 30-year fixed mortgage rate was 3.55%, up from 3.11% at the end of December and last year’s 2.65% record low. It was also the first time rates rose over 3.5% since March 2020. For the week ended Feb. 17, rates rose to 3.92%. 

Redfin economists predict mortgage rates will rise to 4.3% by the end of 2022 as the Federal Reserve raises interest rates.

Redfin chief economist Daryl Fairweather said those rising rates are intensifying the already severe shortage of homes for sale as buyers feel an increasing urgency to buy and homeowners are feeling less urgency to sell. And that imbalance is fueling increased competition. 

“Buyers are battling it out for the few homes on the market in an effort to lock in relatively low payments before rates move even higher, but homeowners who bought or refinanced in the last year are staying put because they don’t want to lose their rock-bottom mortgage rate,” he said in a press release. 

Fifty-seven percent of homes sold during the four-week period ended Feb. 13 had an accepted offer within the first two weeks of being listed. During that same time period, asking prices rose 16% from last year to a new high as new listings fell 8% to a new low. 

Townhouses faced the most competition with 72% of Redfin offers facing bidding wars. That was followed by single-family homes with a bidding-war rate of 70.6%, condominiums and co-ops at 62.9% and multi-family properties at 62.7%. 

Nationally, Spokane, Washington, Sacramento, California, and Seattle had the highest bidding war rates at 83.3%, 80.4% and 79.7%, respectively, followed by Dallas at 78.1% and San Francisco/San Jose at 76.5%.

Boston was No. 10 at 74.8%.