It is a sad week for anyone looking for serious signs of recovery in the US housing market. In July, new home sales were at their lowest in history, and existing home sales were not much better. In the midst of this it is surprising to learn that almost one third of all home sales in the US were all cash deals (according to National Association of Realtors). Before the housing bust only 10% of deals were all cash.
Where does this change come from? Flippers and rehabbers! In a weak market like this people are still making money in real estate. Not many people have $150,000 lying around and to put up that kind of money or secure hard money for purchases means you have to have good confidence in your investments. With almost 30% of purchases being all cash, investors have that confidence.