Cash Sales 36 Percent of All U.S. Home Sales in November

Cash Sales 36 Percent of All U.S. Home Sales in November

Residential News » United States Edition | By WPJ Staff | February 12, 2015 9:15 AM ET

According to CoreLogic, cash sales made up 36.1 percent of total home sales in November 2014, down from 38.8 percent in November 2013.

The year-over-year share has fallen each month since January 2013, making November the 23rd consecutive month of declines. Month over month, the cash sales share ticked up by half of a percentage point, as is typical for the fall and winter months. Due to seasonality in the housing market, cash sales share comparisons should be made on a year-over-year basis. The peak occurred in January 2011 when cash transactions made up 46.4 percent of total home sales. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25 percent.

Real estate owned (REO) sales had the largest cash sales share in November 2014 at 61.1 percent, followed by re-sales (35.2 percent), short sales (32.7 percent) and newly constructed homes (16.3 percent). While the percentage of REO sales that were cash transactions remained high, REO transactions made up only 10 percent of total sales in November and, therefore, had a small influence on the overall cash sales share. In January 2011, when the cash sales share was at its peak, REO sales made up 23.9 percent of total sales.

Michigan had the largest share of any state at 54.4 percent, followed by West Virginia (53.3 percent), Florida (51.4 percent), Alabama (50.7 percent) and South Dakota (45.5 percent). 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 63.2 percent, followed by Miami-Miami Beach-Kendall, Fla. (58.2 percent), West Palm Beach-Boca Raton-Delray Beach, Fla. (57.3 percent), Philadelphia, Pa. (55.9 percent) and Fort Lauderdale-Pompano Beach-Deerfield Beach, Fla. (55.7 percent). Washington-Arlington-Alexandria, D.C.-Va.-Md.had the lowest cash sales share at 15.8 percent.

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