Fewer homebuyers paying cash in Bend

The number of cash buyers as a percentage of all homebuyers in Bend is on the decline, according to data from the Central Oregon Association of Realtors.

Homebuyers paying with cash represented 31 percent of all home purchases in Bend in 2011, the peak year for cash purchases, according to Multiple Listing Service of Central Oregon numbers. Through May of this year, cash buyers accounted for 24 percent of all Bend home sales. In 2015, they represented 23 percent.

“It’s a much different environment in real estate than when cash was being thrown around,” said Carrie DiTullio, a Bend real estate broker.

Cash buyers five years ago played an influential role in the local real estate market, brokers said. They still do, but their influence has lessened as low prices and good deals have largely disappeared. The median sales price for a single-family home in Bend in May rose to $374,000, 15 percent higher than the median price in May 2015, according to the Beacon Report. Though they seem high, prices are about where they need to be, DiTullio said.

“We’re kinda evening out in a much healthier way” than the housing bubble that preceded the Great Recession,” she said. “Some think we’re in another bubble, but I see no sign of that.”

Investors in 2011 didn’t mind tying up cash in a fixer-upper for several months before flipping the home and turning a profit, said DiTullio. Mortgage rates are still low, but prices are higher and deals are harder for investors to find. Instead, buyers now are more inclined to buy for the long term, and prefer to finance at low interest rates and take advantage of the mortgage interest deduction on their income taxes rather than tie up their cash, said Steve Redman, principal broker and new co-owner of Windermere Central Oregon Real Estate.

Nationwide, the percentage of home sales attributed to cash buyers fell to 33 percent in March, down 2.4 percent from March 2015, according to CoreLogic, a real estate data analysis firm based in California. Cash sales averaged 34.7 percent of all sales for the first quarter, according to the firm. Cash sales across the country also peaked in 2011 at 46.6 percent.

In Oregon, cash sales accounted for 28 percent of all home sales in March, according to CoreLogic. Cash buyers accounted for 22.1 percent of home purchases in the Portland metro area that month, down 1.5 percentage points from March 2015.

In Bend, cash buyers in 2011 purchased 725 homes out of 2,373 sold that year, according to the Realtors association. By 2015, cash paid for 783 homes out of 3,436 sold, or 23 percent.

Curtis Delamarter, a Bend broker, said newcomers often arrive in Bend with cash on hand from the sale of their property in Seattle, Portland or Southern California, looking for a lifestyle change and relatively cheaper deals on real estate. They’re not as willing to spend that money on a home purchase as they were when prices were at their lowest.

“In 2011, you could buy a house in Bend for $150,000,” Delamarter said. “That’s no longer possible.”

David Gilmore, a Bend real estate broker, said new arrivals seem unwilling to part with their cash, given low interest rates and the uncertainty of an election year and world events.

“There definitely seem to be fewer cash offers in the marketplace,” Gilmore said. “I had a recent listing that had four offers on it at the same time and none were cash.”

— Reporter: 541-617-7815,


Source: BB Real Estate – topStory

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