Cash is No Longer King in Today’s Housing Market
The sound of an all-cash offer once enticed sellers much more than it does today, all thanks to low mortgage rates and low inventory. “All cash” are often the golden words for beating out another bidder, but in today’s housing market, it can actually hurt a buyer’s chance, according to the Denver Post. All-cash offers typically come with a request for a discount, but sellers are able to gain more cash from financed buyers than cash buyers wanting a deal. In addition, the number of all-cash offers has dropped due to buyers wanting to use their cash somewhere they could get more bang for their buck.
“Cash is not necessarily king. You will net more as a seller with a financed buyer,” Rael said. And that extra money matters toward the next purchase given how much home prices have run-up.
Also, cash buyers tend to be more fickle, rescinding offers more frequently than buyers who have gone through the hassle of obtaining financing, Rael said. In his 16 years, he has yet to see a buyer using a no-money-down VA mortgage back out of an offer.