More Minnesota home buyers are paying CA$H
- Blog Post by: Jim Buchta
- May 8, 2014 - 10:58 AM
One third of all home sales in Minnesota during the first quarter were paid for with cash - a significant increase over last year, according to a new survey by the National Association of Realtors. That increase, in Minnesota and across the country, is somewhat perplexing to the experts. From January through March in Minnesota, 34 percent of all sales were cash compared with just 19 percent two years.
Last year many cash deals were foreclosures that were being bought be investors with plenty of money to spend, but those distressed sales have been waning. Lawrence Yun, NAR's chief economist, said the findings are counterintuitive.
“Distressed home sales, most popular with investors who pay cash, have declined notably in the past two years, yet the share of all-cash purchases has risen,” he said. “At the same time, investors have declined as a market share, indicating other changes have been underway in the marketplace.”
Those distress sales declined from 26 percent of the national market in 2012 to 17 percent in 2013 and 15 percent in the first quarter of this year; NAR projects distressed homes to drop to a single-digit market share by the fourth quarter. All-cash purchases rose from 29 percent in 2012 to 31 percent in 2013 and 33 percent in the first quarter of 2014.
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