The recent Realtors Confidence Index survey reports that cash buyers are 31% of the existing residential home sales market.
The majority of cash purchasers tend to be investors, leaving investors a large percentage of the market, and possibly needed for recovery, helping remove homes that may be difficult to finance.
But the fight isn’t over. Community banks, portfolio lenders and other niche programs are opening up lending solutions for buyers unable to purchase on a all-cash basis. With contracts and sales on the rise, affecting the MSI (months supply of inventory), and new home listings being reduced investors are now expanding their target market, sometimes spilling over into neighboring communities and suburbs to fight for desirable properties.
With spring approaching, we shall see if cash purchases still make up a large percentage of home sales and if demand continues to grow and how current supply is affected by the recent mortgage settlement.