All-Cash Sales Still a Third of the Market

Although cash sales ticked up slightly in August, arnpattern that has been maintained for 14 of the last 15 years, that share of allrnhome sales continued to retreat on a long term basis.  CoreLogic said today that cash sales had a<b33.8 percent portion of the market in August, a less than one point uptick fromrnJuly and was down from a 36.4 percent share in August 2013.  The percentage of cash sales has been lowerrnon a year-over-year basis every month since January 2013.</p

Prior to the housing crisis, therncash sales averaged approximately 25 percent of all sales.  They peaked in January 2011 when cashrntransactions made up 46.3 percent of total home sales.</p

The largest share of cashrntransactions were for the purchase of lender owned real estate (REO) at 56.9rnpercent.  One third of existing homernpurchases were paid for in cash as were 31.8 percent of short sales and 16.5rnpercent of new home sales.  Despite thernfrequency that cash was used to purchase REO those sales themselves representedrnonly 7.2 percent all home purchases in August so had little influence onrnoverall cash numbers. </p

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CoreLogic said that the trend tornwatch is the cash share of existing home or re-sales which at the peak inrnFebruary 2011 was 47.2 percent.  It has nowrnfallen almost 14 percentage points.  Thisrncategory will determine the direction of cash sales going forward as re-salesrnnow constitute 80.4 percent of all home sales. </p

Florida leads the states with a 49.8rnpercent share of cash sales followed by Alabama (48.9 percent), West Virginia</b(45 percent), New York (44.4 percent) and Delaware (44 percent).  West Palm Beach-Boca Raton-Delray Beach ledrnamong the largest Core Based Statistical Areas with cash sales at 56.3 percent,rnfollowed closely by Miami-Miami Beach-Kendall, (56.3 percent), Cape Coral-FortrnMyers, Fla. (55.3 percent), Detroit-Dearborn-Livonia, (54.9 percent) and FortrnLauderdale-Pompano Beach-Deerfield Beach (54.8 percent).