Is the Market opening up to more traditional home buyers?? Time will tell, here is some insight on the situation!

All-cash transactions remain high, but they are showing signs of dropping, which could be good news for traditional home buyers with financing who find they are unable to compete against cash buyers.

Nearly 38 percent of home and condo purchases in the second quarter were from all-cash transactions, according to RealtyTrac’s data. That marks a drop from the first quarter, when all-cash transactions reached a three-year high of 42 percent.

Is Cash Still King?

• As Investors Pull Back, Field Opens for Buyers
• More Home Buyers Bring Cash to Closing
• Buyers Facing Less Competition From Cash Buyers

However, the share of all-cash purchases varies widely in markets across the country. For example, in the Miami metro area, more than 64 percent of home sales were cash in the second quarter, but in Madison, Wis., that figure was only 18.5 percent.

Daren Blomquist, vice president at RealtyTrac, explained to 24/7 Wall St. that some of the highest number of cash sales are occurring in recovering markets that have the highest activity of institutional investors. Also, all-cash sales tend to be highest in areas with still-elevated levels of foreclosures and short sales. Blomquist further notes that all-cash sales are higher for both low-end and luxury properties. Cash sales make up two-thirds of home purchases for up to $100,000 and 45 percent of purchases for more than $2 million.

24/7 Wall St., using RealtyTrac data, reviewed the cities that had the largest percentages of all-cash sales in the second quarter of this year. The following metros showed the highest concentration of all-cash transactions:

1. Miami-Fort Lauderdale-Pompano Beach, Fla.
   Percent of cash sales: 64.1%
2. Cape Coral-Fort Myers, Fla.
   Percent of cash sales: 62.1%
3. Sarasota-Bradenton-Venice, Fla.
   Percent of cash sales: 61.5%
4. Tampa-St. Petersburg-Clearwater, Fla.
   Percent of cash sales: 54.6%
5. Lakeland, Fla.
   Percent of cash sales:53%
6. Orlando-Kissimmee, Fla.
   Percent of cash sales: 52.2%
7. McAllen-Edinburg-Mission, Texas
   Percent of cash sales:52%

Source: “10 Cities Where Homebuyers Pay Cash,” 24/7 Wall St. (Sept. 16, 2014)