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Cash sales fell 2.8 percentage points in April 2016 from the previous year and accounted for 31.6 percent of total home sales, according to a recent data release from CoreLogic.
The data brief showed that on a month-over-month basis, the cash sales share fell by 1.6 percentage points in April 2016 from where it stood in March 2016. During the first four months of 2016, the cash sales share sat at a 33.9 percent average making it the lowest start to any year since 2008. The report states that if the cash sales share continues to fall at the same rate it fell for April 2016, it can be expected that the share will hit 25 percent by mid-2018.
The cash sales share peaked in January 2011 with cash transactions accounting for 46.6 percent of total home sales nationally. This is compared to the cash sales share percentage of total home sales before the housing crisis which averaged approximately 25 percent.
In regards to real estate-owned (REO) sales, in April 2016 they held the largest cash sales share at 56.7 percent. The next highest share for cash sells fell with resales at 31.3 percent, and this was followed by short sales at 28.6 percent and newly constructed homes at 14.5 percent. Despite the fact that the percentage of REO sales from all-cash transactions remained high, the report shows REO transactions accounted for only 5.7 percent of all sales in April 2016.
In January 2011 when the cash sales share was at its peak, the reports says REO sales represented 23.9 percent of the total home sales. Resales usually represent as the majority of home sales, and totaled approximately 83 percent in April 2016, and therefore had the biggest impact on the total cash sales share.
Florida had the largest cash sales share of any state at 45.5 percent for the cash sales share in April 2016, followed by Alabama (45.3 percent), New York (44.2 percent), New Jersey (38.2 percent) and Indiana (38 percent). The report also states that of the nation's largest 100 Core Based Statistical Areas (CBSAs)2 measured by population, Philadelphia, Pa. had the highest cash sales share at 57.9 percent, followed by West Palm Beach-Boca Raton-Delray Beach, Fla. (54.4 percent), Cape Coral-Fort Myers, Fla. (51.7 percent), North Port-Sarasota-Bradenton, Fla. (51.6 percent) and Detroit-Dearborn-Livonia, Mich. (50.8 percent). Syracuse, N.Y. had the lowest cash sales share at 13.3 percent.
