Last year was dominated by cash sales. Or I should say DOMINATED since investors really drove the market. This was true in Sacramento and it was true for many markets across the United States. But this year has been different. In fact, cash has been about half of what it was last year, and it has simply softened the market. Let’s take a look at some images and six quick talking points to share with clients and contacts. Any thoughts?
Key Takeaways for Sacramento County: 2013 vs 2014*
- Total sales volume is down 14% from 2013
- Cash sales are 21% of the market, but they used to be 35% of all sales
- There have been 48% fewer cash sales in 2014
- As prices in real estate have increased, so have cash price levels
- About half of cash sales are still under $200,000
- Less cash has created more space for financed offers to get accepted. There have been more conventional /FHA purchases in 2014 compared to last year. There were 4087 in 2013 and there have been 4194 in 2014.
* Data is based on January to May (single family detached sales in MLS).
I hope this was helpful. By the way, this is completely off topic, but here is my latest wood project. If you didn’t know, I love to tinker with wood – especially scrap wood. I built this outdoor cooler a few days ago out of scrap in my garage.
Questions: How have you been seeing cash investors impact the real estate market (even if you are not local)? What is driving your market right now?