We discuss the winner’s curse in housing markets—based on my joint work with Adam Nowak, Patrick Smith, and Alexei Tchistyi—plus what we’re seeing in today’s buyer’s market, housing affordability, and the implications of bidding wars. 

We unpacked what happens when buying a home requires a large overbid, a trend that has surged in Greater Rochester post-pandemic. Our findings show that while overbidding often “wins” the house, it can lead to adverse financial consequences for buyers. 

We discuss the housing market conditions in the pre- and post-pandemic era and greater Rochester area. From the time on market to the size of overbidding, we relate how the winner's curse has manifested in Rochester even in the current low-inventory environment.