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Cash Sales Share Hits 4-Year Low

money-houseHome sales transacted in cash slipped again in May, falling to a four-year low but remaining elevated compared to the long-run average.

According to sales data put together by CoreLogic, cash sales made up 34.4 percent of total home sales in May, down from 37.4 percent a year prior. It was the lowest share since May 2010, when all-cash sales started ramping up to an eventual peak of 46.2 percent in January 2011.

Prior to the housing crisis, the cash sales share of total home sales averaged close to 25 percent, according to CoreLogic.

As of May, cash sales share has fallen on an annual basis for 17 straight months. Due to the seasonal nature of the housing market, CoreLogic says year-over-year comparisons are a more reliable measure than others.

Florida had the largest cash sales share of any state in May at 53.4 percent. The Sunshine State also claimed three of the top five largest core-based statistical areas, with Cape Coral-Fort Myers coming in second place, West Palm Beach-Boca Raton-Delray Beach in third, and North Port-Sarasota-Bradenton in fourth.

Among other states, New York came in second at 53.4 percent, with Nassau County-Suffolk County taking the top spot for cash sales among metros at 66.4 percent.

By sales type, REO continued to hold the largest share at 55.5 percent, though CoreLogic senior economist Molly Boesel noted "REO transactions made up only 8.2 percent of total sales in May and therefore did not have a large influence on the overall cash sales share."

Meanwhile, home re-sales followed in second place at 34 percent cash sales share, with short sales (32.8 percent) and newly built homes (16.8 percent) trailing.

About Author: Tory Barringer

Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington's student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News' sister publication, MReport, which focuses on mortgage banking news.

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