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Cash sales accounted for just under 30 percent of all home sales in July

Distressed Sales

Cash sales accounted for 29.7 percent of total home sales in July 2016, down 1.9 percentage points year over year from July 2015, according to a press release from CoreLogic.

The cash sales share peaked in January 2011 when cash transactions accounted for 46.6 percent of total home sales nationally. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25 percent. If the cash sales share continues to fall at the same rate it did in July 2016, the share should hit 25 percent by mid-2018.

The cash sales share in the Charlotte-Concord-Gastonia area was down for the month of July over the same period last year and sits at 23.3 percent, a 2.4 percentage point decrease compared with July 2015. The cash sales share in Charlotte-Concord-Gastonia was lower than the 29.7 percent national rate.

REO sales had the largest cash sales share in July 2016 at 57.6 percent. Resales had the next highest cash sales share at 29.4 percent, followed by short sales at 28.1 percent and newly constructed homes at 15 percent. While the percentage of REO sales within the all-cash category remained high, REO transactions have declined since peaking in January 2011. REO sales made up 4.3 percent and short sales made up 2.9 percent of distressed sales in July 2016. The distressed sales share of 7.2 percent in July 2016 was the lowest distressed sales share since September 2007. At its peak in January 2009, distressed sales totaled 32.4 percent of all sales with REO sales representing 27.9 percent of that share. The pre-crisis share of distressed sales was traditionally about 2 percent. If the current year-over-year decrease in the distressed sales share continues, it will reach that “normal” 2-percent mark in mid-2018.

All but eight states recorded lower distressed sales shares in July 2016 compared with a year earlier. Maryland had the largest share of distressed sales of any state at 19.4 percent in July 2016, followed by Connecticut (18.6 percent), Michigan (17.8 percent), New Jersey (15.6 percent) and Illinois (15.5 percent). North Dakota had the smallest distressed sales share at 2.5 percent. While some states stand out as having high distressed sales shares, only North Dakota and the District of Columbia are close to their pre-crisis levels (each within one percentage point).

Figure 3 shows the cash sales share by state for July 2016. New York had the largest cash sales share of any state at 44.6 percent, followed by Alabama (43.6 percent), Florida (39.6 percent), New Jersey (37.3 percent) and Indiana (37 percent).

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