What Percentage of Homebuyers Pay Cash? It Depends on the Market

Among your family and friends, you may not know anyone who paid all cash for a house. So, what percentage of homebuyers pay cash, and how likely are you to receive a cash offer if you sell your home?


It varies by individual market, but cash sales make up a considerable portion of home purchases as the nation gradually shifts toward a buyer’s market and mortgage rates remain close to 7%, according to the National Association of Realtors (NAR).









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In November 2024, cash sales represented 25% of all existing home sales, a slight decline from 27% in both October and the same month last year and down from 32% in January, the highest rate since June 2014.


Despite the rise in home prices to a median of $406,100, buyers have been more eager to pay cash or find a cash solution to avoid higher interest rates on a mortgage. This has also kept many first-time homebuyers out of the market.


According to NAR’s 2024 Profile of Home Buyers and Sellers, only 24% of buyers were first-timers, the lowest share since 1981. Many sellers also prefer to accept all-cash offers to avoid the possibility of financing delays and reduce the chances of an offer falling through — hence the notion that “cash is king.”



Historical effect of economics on the cash real estate market




The number of homes sold for cash tends to rise and fall in line with other economic patterns. Data from the U.S. Census Bureau on the number of new single-family homes that sold for cash from 1988 to 2023 shows that cash sales are more likely to occur during a property boom and then retreat during a downturn.


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For example, during the property boom of the late 1980s, as many as 62,000 new single-family homes were sold for cash in 1988. That number dropped to 37,000 in the brief early 1990s recession. A similar trend emerged in the 2000s. Cash sales jumped to 52,000 in 2005 before falling to 17,000 in 2009 in the aftermath of the Great Recession.


During the pandemic housing market boom, all-cash purchases jumped 10% from the year prior and became the most effective tactic for winning bidding wars. Though market conditions are vastly different in 2024, cash sales remain prevalent due to elevated housing prices and high mortgage rates.


In essence, a strong jobs market gives more buyers the ability to pay for a house with cash, and when housing demand surges, cash purchases may rise in response to a more competitive market. When markets cool, housing often becomes less competitive, and people may prefer to save their money in the face of financial instability. | bit.ly/3XLoEJb


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