All-cash purchases accounted for 45% of all residential sales in August, according to RealtyTrac’s latest U.S. Residential & Foreclosure Sales Report. This is up from 39% in July, and up 30% year-over-year.
In metros with a population of 1 million or more, Miami had the highest per cent of all-cash sales at 69%, followed by Detroit at 68%, Las Vegas at 66%, Jacksonville, Florida at 65^ and Tampa at 64%.
What’s more? The share of institutional investors buying 10 properties or more in the last 12 months jumped to 10% of all sales. This is up from a share of 9% in July, and 9% a year ago.
“This recovery in home prices and sale volume continues to be driven in large part by cash buyers and institutional investors, as evidenced by the increasing share of sales represented by those two categories in August,” said Daren Blomquist, vice president at RealtyTrac in a press release.
Some argue that its these cash purchases that have driven home sales, are distorting prices, and that this is unsustainable. They are also reportedly shutting out first time homebuyers who are already taking a beating from rising mortgage rates and tighter lending standards.
Here’s a look at the spike in all cash sales:
And here’s a look at the share of institutional investor purchases: