Cash Sales Decline as REO Sales Dwindle


While all-cash sales continue to decline as a percentage of
all home sales, in several states they still account for more than half of all
residential sales transactions. 
CoreLogic said on Wednesday that 36.1 percent of home sales in November
2014 were all-cash, down from 38.8 percent one year earlier.  November became the 23rd
consecutive month in which the share of sales declined on a year-over-year

Their portion of all sales did tick up by half a percentage
point from the all-cash share in October but CoreLogic said this is typical for
the fall and winter months
.  Because of
this seasonality the company said comparisons should be made on an annual

The peak of cash sales occurred in January 2011 when those
transactions had a 46.4 percent share. 
In more typical times, i.e. before the housing crisis, the share
averaged 25 percent.

Still the share remains high in several states.  In Michigan 54.4 percent of sales were
all-cash and in West Virginia 53.3 percent. 
Florida followed with 51.4 percent, Alabama and South Dakota rounded out
the top five at 50.7 percent and 45.5 percent respectively.  Among large metropolitan areas the highest incidence
was in Detroit where cash sales made up 63.2 percent of the total. Those sales
also accounted for more than half of all sales in Miami, West Palm Beach-Boca
Raton, Philadelphia, and Fort Lauderdale.   



Real estate owned (REO) sales continue
to have the largest proportion of cash sales, 61.1 percent in November, but with
their numbers declining those sales have a lessening influence overall housing
statistics.  When cash sales hit that January
2011 peak REO made up 23.9 percent of all home sales; in November 2014 only 10
percent of sales were of REO properties.   Existing
homes sales (resales) were 35.2 percent all-cash transactions, short sales had
a 32.7 percent cash share and newly constructed homes 16.3 percent.   

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