So far in 2011, nearly HALF of Toledo area real estate transactions were CASH
In January 2011, nearly 46 percent of all Toledo area transactions were CASH, that’s according to John English at Birch Tree Title and NORIS MLS. That’s the highest percentage of cash sales in the past 5 years. It’s a reflection of our hard-hit market and banks not loaning money like they used to a few years ago.
February 8, 2011 The Wall Street Journal reported “Buyers in markets around the U.S. are snapping up homes in all-cash deals, betting that prices are at or near bottom and breathing life into some of the nation’s most battered housing markets. Nationally, 28% of sales were all-cash transactions last year, according to the National Association of Realtors. The rate was 14% in October 2008, when NAR began tracking it.” The article continues… “The harder a market has been hit, the higher the percentage of cash deals. Some cash purchases reflect a tight lending environment, where even people with good credit and ample down payments are sometimes turned away from conventional borrowing. The rates are great but the underwriting is brutal.”
As an agent who works with many buyers, most of whom are creditworthy, I’ve seen this.
According to English, the average sale price in December 2010 was $110,000. It declined to $94,000 in January 2011. The increase in all-cash deals and the decline in the average price are indicative of the rest of the world seeing a bargain in Northwest Ohio real estate.
That’s true. And I’m not just agreeing with that because I sell real estate.
Also, according to English, the listing inventory declined to 7,035 properties in January 2011, the lowest level of any month in the past 4 years. The January 2011 listing to sales ratio was 17.9 months inventory, which is the lowest January ratio in the last 4 years. Increasing sales and declining listing inventory are very positive trends toward increasing real estate prices.
On the flip side of that, however, the number of bank-owned properties coming on the market in 2011 is increasing – according to agents Jeff Bockrath and Rod Culler who both specialize in listing bank-owned foreclosed properties. The number could be large enough that it will depress real state prices in our region. Jeff thinks that this will continue into 2012. Rod and Jeff are in a far better position to see the inventory issue than most of us. If sales don’t pick up, prices will likely go down. But f sales pick up, so may prices. We are attracting buyers from all over the world. If they combine with first time buyers realizing that NOW IS THE TIME TO BUY, we could have a very good market in 2011. Imagine having buyers and sellers at the same time.
Special thanks to John English of Birch Tree Title for allowing me to use his data in my post.