Tag Archives: all-cash buyers

Due to an environment of rising mortgage rates and an influx of all-cash buyers, more and more are having to increase their down payments to offset the cost of rising homes. Click through to find out why there is a prevalence of all-cash buyers in the current market.

“In a homebuyer’s ideal world, rising mortgage rates would push demand and home prices down enough to make up for high interest payments. But that’s not what’s happening now,” said Redfin Economics Research Lead Chen Zhao.

"Home sales have been stable for several months, neither rising nor falling in any meaningful way," said NAR Chief Economist Lawrence Yun.

The correlation between the asking price and the size of the down payment is behaving as expected—as the housing market has cooled over the past year, down payment amounts are down by 10%.

Both raw profits and return on investment have improved nationwide for 11 straight years, shooting up again in 2022 as the national median home price increased 10% to $330,000—another annual record.

“Today’s affluent homebuyers are motivated to pay in cash because the surge in mortgage rates makes them want to avoid loans—and the high monthly interest payments that come with them—altogether,” said Redfin Economics Research Lead Chen Zhao.

While several factors have played into affordability issues for many in attaining homeownership, Adam Mercado of ClearPath Lending stresses that timing and patience are key for this segment in today’s housing finance landscape.