Cash is still king in the local housing market. The market share is higher than both the U.S. and state average, but the king’s crown is slipping.
All-cash purchases continued to account for a little more than a third of Tri-Cities single-family and condo sales during the first quarter of this year. That’s consistent with the 2020 annual cash-sale market share, which was at a six-year low. At the same time, clamor that newcomers flush with cash from sales of homes in higher priced areas are shutting locals out of the market are on the upswing. That accounts for some of the cash business, but not all of it.
The first quarter market share of cash sales for the seven-county metro area was 34.8%, up by 0.06% from 34.7% last year.
A drill-down on cash sales shows the market share was 37.9% in the Johnson City Metropolitan Statistical Area (MSA). That’s up 5% from last year. In Kingsport-Bristol they accounted for 31.6% of sales, down 5% from last year, according to ATTOM Data Solutions’ Home Sales Report.
Carter, Washington, and Unicoi counties make up the Johnson City MSA. Kingsport-Bristol includes Hawkins and Washington counties in NE Tenn. and Scott and Washington counties in SW Va.
There were 723 in the region during the first quarter – 364 in the Johnson City metro area and 364 in Kingsport-Bristol.
Annual cash sales shrank to a six-year low in 2020, dropping to a regional market share of 34.6% from 40.9% in 2014.
Nationwide, all-cash purchases accounted for 26.5% of single-family home and condo sales in the first quarter, the highest level since the first quarter of 2019. The first-quarter 2021 number was up from 22.9% in the fourth quarter of 2020 and 26% in the first quarter of last year.
At one time, institutional investors accounted for a small share of cash sales; however, their numbers have declined in recent years as local home prices began increasing beyond the typical 3.5% range. There were not enough local institutional investor sales during the first quarter to be included in the report. Institutional investor purchases are those total 10 a year.
Institutional sales accounted for 4% of the cash sales in Tennessee during the first quarter and 2% of those in the U.S.
Cash sales in Tennessee declined to 31.8% from 35.4% during the first quarter.
©donfenley.com All rights reserved.
Categories: REAL ESTATE