Cash sales dip for Prov. metro homes in May

CASH SALES declined for homes in the Providence-Warwick-Fall River metropolitan area in May by 8.8 percentage points compared with May 2015, CoreLogic said this week. / COURTESY CORELOGIC
CASH SALES declined for homes in the Providence-Warwick-Fall River metropolitan area in May by 8.8 percentage points compared with May 2015, CoreLogic said this week. / COURTESY CORELOGIC

PROVIDENCE – Cash sales declined for homes in the Providence-Warwick-Fall River metropolitan area in May by 8.8 percentage points compared with May 2015, CoreLogic said this week.
Cash sales accounted for 23.3 percent of total home sales in the Providence metro, which was lower than the national cash sales share of 30 percent.
The national cash sales share also fell year over year by 2.5 percentage points, CoreLogic said.

For the first five months of 2016, the cash sales share averaged 33 percent, the lowest start to any year since 2008. In January 2011, the cash sales share peaked – cash transactions accounted for 46.6 percent of total home sales nationally. Before the housing crisis, the cash sales share of total home sales averaged approximately 25 percent. If the cash sales share continues to fall at the same rate it did in May, the share should hit 25 percent by mid-2018, CoreLogic said.

Nationwide, real estate-owned sales had the largest cash sales share in May at 56.6 percent. Resales had the next highest cash sales share at 29.8 percent, followed by short sales at 27.9 percent and newly constructed homes at 14.6 percent.

The percentage of REO sales within the all-cash category remained high, but REO transactions accounted for only 5.1 percent of all home sales in May. When the cash sales share was at its peak in January 2011, REO sales represented nearly 24 percent of total home sales.

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Because they typically make up the majority of home sales, resales have the greatest impact on the total cash sales share – they totaled approximately 83 percent in May.

Of the nation’s largest 100 core-based statistical areas, Detroit-Dearborn-Livonia, Mich., had the highest cash sales share at 53.4 percent, while Syracuse, N.Y., had the lowest cash sales share at 13.7 percent.

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