Nearly a third (30 percent) of home purchases this year were paid for with all cash, according to a recent Redfin analysis. That’s up from 25.3 percent during 2020 and is the largest share since 2014, when 30.6 percent of homes were purchased with all cash.
“I’ve never seen more cash in Boise’s housing market than I’ve seen in the past year,” Idaho Redfin Real Estate Agent Shauna Pendleton said in a release. “I just sold a $700,000 home to a cash buyer last week. The entire $700,000 came from his E*Trade account.”
Remote work has allowed homeowners in expensive cities, including San Francisco and New York, to sell their homes and move to less expensive areas, where they can often afford to buy properties in cash.
“Affluent homeowners in Seattle, Portland and parts of California are selling their homes for $1 million or $2 million,” Pendleton said. “Then they’re coming to Boise, where they’re buying houses that are twice the size for half the price.”
Investors, who often pay in cash, are wading back into the housing market, Redfin reported. Home purchases by investors rose 2.7 percent year-over-year in the first quarter, the first period of growth since the pandemic began.
In the West Palm Beach, Fla., metro area, more than half (52.6 percent) of home purchases this year were paid for in cash. That’s the largest share of metro areas in Redfin’s analysis. West Palm Beach was followed by Naples, Fla. (52.5 percent), Nassau County, N.Y. (50.2 percent), North Port, Fla. (49.4 percent), Port St. Lucie, Fla. (46.2 percent), Greenville, S.C. (45.4 percent), Palm Bay, Fla. (44.1 percent), Cape Coral, Fla. (44.1 percent), Des Moines, Iowa (41 percent), and Jacksonville, Fla. (40.1 percent).
“Florida is a big second-home market, and second-home buyers often pay with cash,” West Palm Beach Redfin Real Estate Agent Dina Blau said. “During the pandemic, folks also flocked to Florida to buy primary homes. They sold their houses in New York, New Jersey, Chicago or California and used the proceeds to pay cash for properties in Florida.”
Expensive California metros, where it’s more challenging to pay with cash because home prices are relatively high, were at the bottom of the list. In both San Jose and Oakland, 12.5 percent of reported home purchases this year used all cash, the lowest share of the metros Redfin analyzed. Next came Richmond, Va. (16 percent), Los Angeles (16 percent), San Diego (16.2 percent), Lake County, Ill. (17.2 percent), Sacramento (17.7 percent), San Francisco (17.8 percent), Oxnard, Calif. (18 percent), and Bakersfield, Calif. (19.3 percent).