A new report from Redfin found that 19.9 percent of successful offers submitted by Redfin agents in select major U.S. markets waived the inspection contingency in June, compared with just 13.2 percent during the same month in 2019.

Winning offers waived the appraisal contingency at a similar rate of 20.6 percent, up from 17.4 percent in June of the prior year and representing the largest share since at least 2018, when Redfin began tracking this data.

“Waiving these contingencies is a common strategy homebuyers use to make their offers more competitive by assuring the seller that the deal will close without unforeseen hiccups and negotiations,” the report stated. “The inspection contingency allows the buyer to cancel a purchase or request repairs if they find an issue during the inspection period. The appraisal contingency allows the buyer to cancel a deal or renegotiate the price if the appraisal comes back lower than a specified amount. In the event that a buyer waives the appraisal contingency and the appraisal comes in low, the buyer must have enough cash to cover the difference between the appraised value and offer price.”

These stipulations are built into standard home purchase agreements as protections for the buyer, so waiving them can put the buyer at risk. Bidding wars have been on the rise in recent months, with more than half (53.7 percent) of Redfin offers facing competition in June, up from 51.8 percent in May and 44.4 percent in April, the report showed.

Record-low mortgage rates, which fell below 3 percent for the first time in history this month, are driving strong homebuyer demand amid a severe shortage of homes on the market. Active listings, the count of all homes that were for sale at any time during a given month, dropped 20.7 percent year over year in June, the 10th-straight month of declines.

“I put a house on the market the other day and within about 24 hours I already had 42 showings booked,” Lindsay Katz, a Redfin agent in Los Angeles, said in the report.

Katz recently sold a home, listed at $685,000, to a buyer who beat out the 11 other bidders by waiving the appraisal and inspection contingencies, and agreeing to get their loan approved in 10 days. The standard in California is 21 days.

“The $770,000 winning offer wasn’t even the highest bid,” Katz said. “We could’ve gotten another $30,000 for the house, but we opted to take the safe bet over the highest offer because there was so much uncertainty due to the pandemic.”

The share of offers that waived inspection contingencies dropped to 15 percent in April from 23.1 percent in March, with the share of offers waiving appraisal contingencies seeing a similar decline. This is likely because buyers were seeking out flexible arrangements due to the uncertainty caused by stay-at-home orders, according to Redfin lead economist Taylor Marr.

With these restrictions now lifted in most states, the share of successful offers waiving these contingencies has rebounded. Waiving contingencies isn’t the only way buyers can make their offers more competitive. About 20 percent of Redfin agents say that having a buyer write a personal letter to a seller has helped them win a bidding war, according to a July survey of nearly 400 agents.

Redfin is a technology-powered residential real estate company, including brokerage, iBuying, mortgage, and title services.