Special offer

Cash Offers are High in Demand

By
Real Estate Broker/Owner with House to Home, Inc. - Denver Real Estate - 720-231-6373 DRE# ER40011786

Cash Offers are High in Demand

 

Cash offers could make a difference in winning the bid or not!   When there are multiple offers (sometimes over 10 offers) cash does rule!    

 

This past spring and summer in Denver was a frenzy when a new listing came on the market, with multiple showings all at the same time, and multiple offers received within hours.     Some agents were trying to be slick by offering cash, then switching to a financed offer.   Obviously, it is most important to see proof of funds upfront before changing status to under contract.

 

With a cash sale, there are less contingencies, and the inspection may end up being a bit more strenuous, asking for more inspection items to be repaired.    Some cash buyers are investors, and have already done their inspection.

 

Cash offers are desired due to lack of financing issues.    There still are lenders that SAY the buyer can buy, but fail to perform and get to the closing table.    Have seen issues come up the week before closing where you just have to scratch your head --- why then?    Buyers can terminate a contract at loan objection subjectively, which is a few days prior to closing.    We saw offers written so far over purchase price, you just about knew the appraisal would never come in "at value".    Some offers had verbiage to address some of the difference, and buyer would contribute thousands over appraised value.   There were buyers that had cold feet and terminated.

 

Cash offers can close quickly, and if a home is vacant, it is highly desired by the Seller.   A cash offer can close in a few days, where a financed offer usually takes 30-45 days to close. 

 

This year I have seen 25% of my transactions result in cash offers.    Whether the buyer actually had the cash saved, borrow from their retirement accounts, from a eventual estate payout or a family member, they came up with CASH.

 

In order to secure the home of their dreams, some CASH BUYERS will purchase with cash, then put a mortgage on the property after closing and return the money borrowed.    It is all about what works for the buyer and their individual financial picture.

 

 

Posted by

Joan Cox
Broker/Owner, REALTOR®
House to Home, Inc.

Serving the Denver Metro area including all suburbs


Helping Buyers and Sellers achieve their real estate dreams, one house at a time!

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Comments (27)

Robert Bob Gilbert
Berkshire Hathaway HomeServices Anderson Properties - Katy, TX
Your Katy TX ( West of Houston) Real Estate Expert

Joan, I can see in your very hot, hot market where sellers would ceratinly prefer a cash offer over a bank fianced transaction. Borrowing the money to obtain the cash and the paying it back by fiancing after closing will certainly work well for some buyers. 

Nov 18, 2015 04:04 AM
Amanda S. Davidson
Amanda Davidson Real Estate Group Brokered By Real - Alexandria, VA
Alexandria Virginia Homes For Sale

Joan, I have seen more cash offers this year on my listings that ever before and have had many buyers take the same route. It's such a big selling point in a multiple offer situation. Great post!

Nov 18, 2015 05:23 AM
Larry Johnston
Broker, Friends & Neighbors Real Estate and Elkhart County Subdivisions, LLC - Elkhart, IN
Broker,Friends & Neighbors Real Estate, Elkhart,IN

Hi Joan Cox ,  Yep, Cash is still King when it comes to fast closings and assurance there will be a closing.

Nov 18, 2015 05:54 AM
Beth Atalay
Cam Realty and Property Management - Clermont, FL
Cam Realty of Clermont FL

Joan, 60% of my sales were Cash transactions this year but cash is common in our area.

Nov 18, 2015 07:20 AM
Joan Cox

That is a high number, but would imagine, some are 2nd homes.

Nov 18, 2015 08:47 AM
Ginny Gorman
RI Real Estate Services ~ 401-529-7849~ RI Waterfront Real Estate - North Kingstown, RI
Homes for Sale in Southern RI and beyond

Joan, I would say that our multi million dollar sales are usually cash but it seems the rest are far and few between lately.

Nov 18, 2015 08:46 AM
Evelyn Johnston
Friends & Neighbors Real Estate - Elkhart, IN
The People You Know, Like and Trust!

Why an agent would write a cash offer and submit it without the proof of funds baffles me. Cash is king in your market. We do not have the extreme sellers market although we can get 2 or 3 competing offers.

Nov 18, 2015 09:22 AM
George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Joan after following you market reports and knowing what the prices are like in your area 25% sounds amazing.  Hope that continues to be the trend for you.

Nov 18, 2015 09:27 AM
Joan Cox
House to Home, Inc. - Denver Real Estate - 720-231-6373 - Denver, CO
Denver Real Estate - Selling One Home at a Time

Some price points see cash offers more than others but this year in Denver I saw this happening in all price points.

Nov 18, 2015 10:05 AM
Kwee Huset
Kwee Huset Realty - Venice, FL
Venice Florida Homes For Sale

Hi Joan, you are right on. Cash is King and cash does rule. Transaction can close quickly without appraisal contingency for loan approval.

Nov 18, 2015 11:47 AM
Lou Ludwig
Ludwig & Associates - Boca Raton, FL
Designations Earned CRB, CRS, CIPS, GRI, SRES, TRC

Joan

Your right on point . . . . Cash is a big part of the current real estate market.

Good luck and success.

Lou Ludwig

Nov 18, 2015 11:51 AM
Jennifer Fivelsdal
JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571 - Rhinebeck, NY
Mid Hudson Valley real estate connection

Joan I love a cash deal,  the transaction is so much easier.  I had a few this year and hope I will have even more in the coming year.

Nov 18, 2015 12:29 PM
Steven Beam
RE/MAX Alliance - Parker Colorado Real Estate. - Parker, CO
Parker Colorado Real Estate

Just stoipping by to say howdy and heck yeah I'll take cash anyday over financing. Hope you are well and see ya aorund town soon.

Nov 18, 2015 02:11 PM
Gabe Sanders
Real Estate of Florida specializing in Martin County Residential Homes, Condos and Land Sales - Stuart, FL
Stuart Florida Real Estate

Hi Joan.  Yes, cash can be very desirable for the seller.  Though, the amount offered is also of significance.

Nov 18, 2015 08:27 PM
Maria Gilda Racelis
Home Buyers Realty, LLC-Manchester, Bolton. Vernon,Ellington - Manchester, CT
Home Ownership is w/in Reach. We Make it Happen!

Hi Joan:

Perhaps it can be attributed to buyers who are investing from other parts of the world because Denver and some parts of Colorado are attractive to international buyers.

And you are quite correct, investors don't have any contingency for the most part which makes the closing smoother and quicker.

Nov 18, 2015 09:49 PM
Debb Janes
Nature As Neighbors - Camas, WA
Put My Love of Nature At Work for You

Every market is so different. Cash is good, but a large down from a prequalified buyer can still trump it when the bid is a bit higher. At least that's the experience in our market. 

Nov 18, 2015 10:20 PM
Lawrence "Larry" & Sheila Agranoff. Cell: 631-805-4400
The Top Team @ Charles Rutenberg Realty 255 Executive Dr, Plainview NY 11803 - Plainview, NY
Long Island Condo and Home Specialists

Joan, Cash is KING. We have seen it happen many times this year - buyers losing out when they need to apply for a mortgage first...

Nov 18, 2015 11:59 PM
Roy Kelley
Retired - Gaithersburg, MD

This is very good information to share with prospective home buyers.

Nov 19, 2015 12:36 AM
Grant Schneider
Performance Development Strategies - Armonk, NY
Your Coach Helping You Create Successful Outcomes

Joan - in your market you need to do whatever it takes to buy the home you want. 

Nov 19, 2015 12:40 AM
Mary Yonkers
Alan Kells School of Real Estate/Howard Hanna Real Estate - Erie, PA
Erie/PA Real Estate Instructor

Joan Cox Cash talks and who doesn't love good, old, hard cash.  Fewer headaches in most cases. 

Nov 19, 2015 09:42 AM
Morgan Evans
Douglas Elliman Real Estate - Manhattan, NY
LICENSED REAL ESTATE SALESPERSON

In our market there are a lot of all cash buyers so even cash buyers need to be competitive in other terms to compete with other buyers. It is a good idea to finance back if one wishes to obtain mortgage after sale is closed.

Nov 19, 2015 11:15 AM