Cash Sales Decline as REO Sales Dwindle

While all-cash sales continue to decline as a percentage ofrnall home sales, in several states they still account for more than half of allrnresidential sales transactions. rnCoreLogic said on Wednesday that 36.1 percent of home sales in Novemberrn2014 were all-cash, down from 38.8 percent one year earlier.  November became the 23^{rd</supconsecutive month in which the share of sales declined on a year-over-yearrnbasis.  </p}

Their portion of all sales did tick up by half a percentagernpoint from the all-cash share in October but CoreLogic said this is typical forrnthe fall and winter months.  Because ofrnthis seasonality the company said comparisons should be made on an annualrnbasis.</p

The peak of cash sales occurred in January 2011 when thoserntransactions had a 46.4 percent share. rnIn more typical times, i.e. before the housing crisis, the sharernaveraged 25 percent. </p

Still the share remains high in several states.  In Michigan 54.4 percent of sales werernall-cash and in West Virginia 53.3 percent. rnFlorida followed with 51.4 percent, Alabama and South Dakota rounded outrnthe top five at 50.7 percent and 45.5 percent respectively.  Among large metropolitan areas the highest incidencernwas in Detroit where cash sales made up 63.2 percent of the total. Those salesrnalso accounted for more than half of all sales in Miami, West Palm Beach-BocarnRaton, Philadelphia, and Fort Lauderdale.   </p

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Real estate owned (REO) sales continuernto have the largest proportion of cash sales, 61.1 percent in November, but withrntheir numbers declining those sales have a lessening influence overall housingrnstatistics.  When cash sales hit that Januaryrn2011 peak REO made up 23.9 percent of all home sales; in November 2014 only 10rnpercent of sales were of REO properties.   Existingrnhomes sales (resales) were 35.2 percent all-cash transactions, short sales hadrna 32.7 percent cash share and newly constructed homes 16.3 percent.   

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