According to CoreLogic Wednesday, cash sales of US homes made up 37.9 per cent of total sales nationally in February 2015, down from 40.6 per cent in February 2014. February is the 26th consecutive month of declines.
Home Sales, US
Month over month, the share of all-cash home sales fell by 1 percentage point, said Corelogic Wednesday. Due to seasonality in the housing market, cash sales share comparisons should be made on a year-over-year basis.
The cash sales share peak occurred in January 2011 when cash transactions made up 46.5 per cent of total home sales nationally. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25 per cent. If the cash sales share continues falling at the same rate it did in February 2015, the share should decrease to 25 per cent by mid-2018.
Real estate-owned (REO) sales had the largest cash sales share in February 2015 at 59.8 per cent, followed by resales (37.6 per cent), short sales (34.3 per cent) and newly constructed homes (15.8 per cent). While the percentage of REO sales that were all cash transactions remained high, REO transactions made up only 9.7 per cent of all sales in February. In January 2011, when the cash sales share was at its peak, REO sales made up 23.9 per cent of total home sales. Resales make up the majority of home sales at about 80 percent, and therefore have the biggest weight on the total cash sales share.
Florida had the largest share of any state at 54.6 per cent, followed by Alabama (51.9 per cent), New York (48.4 per cent), Indiana (47.8 per cent) and Michigan (44.9 per cent). Of the nation’s largest 100 Core Based Statistical Areas (CBSAs) measured by population, Detroit-Dearborn-Livonia, Mich. had the highest share of cash sales at 60.5 percent, followed by Cape Coral-Fort Myers, Fla. (59.4 per cent), Miami-Miami Beach-Kendall, Fla.(59.3 per cent), Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla. (58.5 per cent) and West Palm Beach-Boca Raton-Delray Beach, Fla. (58.4 per cent). Washington-Arlington-Alexandria, D.C.-Va.-Md. had the lowest cash sales share at 16.9 per cent.