A third of home sales in March were all cash transactions reported by CoreLogic. This would be a reduction in 2.8 percentages points, the company termed it a significant drop, from February. CoreLogic also stated that the typical cash share of sales over the first ninety days of 2016 was 34.7 %, the lowest for a first quarter since 2008.
All Cash Home Sales Down Significantly
Cash sales peaked in January 2011 at 46.6 % of total home sales nationally, near double the average share prior to the housing crash. If those sales continue to decline at the same rate as the February-March pace, CoreLogic estimates they are going to return to the “normal” 25 percent level by mid-2018.
As usual, sales of lender owned property (REO) had the greatest share of cash sales, 57.2 percent. However, REO transactions accounted for only 6.8 percent of March sales so the impact on the entire cash share was small. When cash sales were in their peak REO sales made up close to a quarter of the market.
Resales accounted for 80 % of sales and had the second highest cash share at 32.9 %. Short sales, again only a small percentage of the overall market, had a cash share of 30.6 % while 14.4 percent of new home sales did not involve a mortgage.
Alabama had the largest cash sales share of any state at 49.8 percent, followed by New York (47.5 percent), Florida (45.9 percent), Michigan (41.8 percent) and Indiana (41%). Of the nation’s largest 100 Core Based Statistical Areas (CBSAs) measured by population, Philadelphia led having a 55.7 percent cash share. Four Florida cities followed; West Palm Beach-Boca Raton, Cape Coral-Fort Myers, Sarasota-Bradenton, and Miami, by having shares exceeding 50 %.