The share of home purchased with all-cash is continuing to drop, but even with a -3.0 percentage point change between July 2013 and July 2014 they still make up nearly a third of all sales. CoreLogic said today that 32.9 percent of home sales during the month were all-cash, the lowest share since August 2008. Prior to the housing crisis cash sales typically comprised about a quarter of all home sales.
The percentage of cash sales has fallen on an annual basis every month since January 2013 and is now down over 10 percentage points from the peak of 46.3 percent in January 2011. On a month-over-month basis the share of cash sales was down .10 percent.
The largest share of cash transactions were for real estate owned (REO) properties at 56.3 percent, but those sales have also fallen from a peak of 23 percent of all sales to 7.1 percent this past July. Thus the high percentage of cash sales among those properties had little effect on the percentage of such sales in the market as a whole. Existing homes had a 32.4 percent cash share, short sales 31.1 percent, and new homes 16 percent.
CoreLogic said that the cash share of existing home sales has fallen almost 15 points from its peak cash share of 47.1 percent in February 2011. This is a trend to watch, the company says, because it will determine the direction of cash sales in the future as the existing home category is now 81 percent of the residential real estate market.
The highest share of cash sales was in Florida at 49.7 percent followed by Alabama (47.6 percent), New York (44.5 percent), West Virginia (42 percent) and Idaho (39.9 percent). West Palm Beach-Boca Raton-Delray Beach had the highest share of cash sales among the 100 largest core metropolitan statistical areas at 57.9 percent. Three other Florida metros followed; Cape Coral-Fort Myers. (57.3 percent), Miami-Miami Beach-Kendall (56.5 percent), North Port-Sarasota-Bradenton (55.8 percent). The Detroit-Dearborn-Livonia, Michigan area with 55.8 percent rounded out the top five. The Washington, DC metro area had the lowest cash sales share at 15.4 percent.
