All Cash Buyers Highest Since 2014

While mortgage interest rates have risen from their all-time lows in recent years, the share of all cash buyers reached the highest level in a decade.

As of January, the share of all cash homebuyers now stands at 32% of home sales, according to a report from the National Association of Realtors (NAR). Since October 2022, all cash home buyers who did not finance their recent home purchase have been more than one-quarter of the real estate market.

The increase in all-cash transactions comes as U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) issued a notice of proposed rulemaking that would require certain people involved in real estate closings and settlements to report information to the agency about all-cash residential transactions nationwide involving legal entities and trusts. Read more about the proposed rule here.

Data from the last six months of the NAR’s Confidence Index shows these purchasers are more likely to be vacation buyers and investors. However, primary residence buyers are actively purchasing using all cash.

“Looking at primary residence buyers, all cash purchases have increased in the last two years,” said Jessica Lautz, NAR’s deputy chief economist and vice president of research. “These housing consumers owned a home, sold it, and then they could purchase their next property without a mortgage. The freedom to make this purchase was likely due to the large amount of housing equity they have earned as home prices have increased in recent years.”