Tag Archives: Cash Sales Share

REO sales have declined by more than two-thirds since their peak five and a half years ago.

Overall housing inventory has been tight for 44 straight months, and the share of distressed properties sold is way down from its peak. But that isn't stopping investors.

The percentage of home sales that were all-cash transactions was higher in November than in recent months due to TRID. Will the cash sales share return to normal or will the delays keep it elevated?

At their peak in January 2011, cash sales accounted for nearly half of all residential home sales in the United States (46.5 percent). Since then, that percentage has steadily declined; in August 2015, it was reported at 31.7 percent, less than one-third of all home sales—a decline of more than 3 percentage points from August 2014, when it was 34.9 percent.

With July’s decline, the cash sales share has fallen year-over-year every month since January 2013, a total of 31 consecutive months, according to CoreLogic. July 2015’s reported share of 30.8 percent was a dropoff from the share of 34.2 percent reported in July 2014. As has historically been the case, REO sales made up 56 percent of cash sales in July 2015, and resales had the second highest share at 30.2 percent.

Though more than a quarter of REO sales were cash transactions in June, REO sales made up only about 6 percent of total home sales during the month. During the peak month of January 2011 for cash sales, REO properties made up about 23.8 percent of all home sales.

May 2015's cash sales share of nearly 32 percent was down by 31 percent from the peak of 46.5 percent recorded in January 2011. CoreLogic estimates that if the cash sales share continues to decline at the same rate as it did in May 2015, the cash sales share should fall back down to its pre-crisis level of 25 percent by the middle of 2017.

As has historically been the case, REO sales had the largest cash sales share in March, followed by resales (34.5 percent), short sales (31.6 percent), and new home sales (14.9 percent). All those numbers represented declines from February, according to CoreLogic.