What does "Cash Buyers Only" Mean?
A cash buyer is someone who pays for a house with cash. These buyers do not require financing (a loan) to pay the seller. In the past, an all-cash bid on a house was lower than the asking price. This is because of the benefits of selling your home for cash (which we discuss below).
However, the COVID-19 pandemic has made it difficult to buy a house. For this reason, it’s common to see bidding wars for most properties. Currently, it’s more common for cash offers to be at or well above the seller’s asking price.
But, are cash buyers better than other buyers?
Benefits of Selling Your Home for Cash
The pandemic has forced the housing market into a seller’s market, meaning houses are selling quickly. This also means that sellers are able to be more particular about the offers they accept.
That being said, there are many benefits of selling your house for cash, and understanding these benefits will help you to answer the question, “Are cash buyers better?” Read on to find out!
No Updates Needed = A Faster Selling Process
All-cash offers are low-risk because there’s no chance of the financing falling through. This is because the buyer doesn’t have to get a mortgage to be able to pay for the house.
Part of obtaining a mortgage is waiting for an application to be approved. This delays the closure of a sale. In some cases, the sale can’t go through because the buyer doesn’t qualify for the loan.
As we said, this doesn’t happen with cash buyers because they already have the money to pay. For this reason, an all-cash sale is the fastest way to sell a house!
Avoid Real Estate Fees
Part of answering the question “Are cash buyers better?” involves understanding the fees involved when selling a house. It’s common to hire a real estate agent when selling your house, and these agents help you find buyers. In exchange, the seller gets a commission from the sale. For all-cash sales, you don’t typically work with a real estate agent. Therefore, you don’t have to pay real estate fees.
Selling a house is a stressful process; there is a lot of time and energy that goes into preparing a house for sale, and accepting an offer. Seeing the actual process through to closure can take months.
On the other hand, cash buyers make the process much easier for sellers; they don’t have to complete mountains of paperwork or go back and forth with a lender on the price. Furthermore, it’s not only the fastest way to sell a house, but it’s arguably the best way to sell a house, too.
Are Cash Offers Common?
Working with a mortgage lender is still the most common method of buying a house. In the past, all-cash offers were made on homes facing foreclosures or fixer-uppers. They were also more common when someone needed to buy a house in a hurry.
Certain life changes can result in someone becoming a cash home buyer. For example, a divorce, job loss, or family emergencies are reasons why you might need to buy a house immediately. These people will occasionally pay in cash to improve their offer.
Evidently, cash buyers are becoming more common. According to the National Association of Realtors, the number of buyers paying in cash has risen to 33%. This significant increase is partially due to the COVID-19 pandemic and lower interest rates. The pandemic has made the housing market increasingly competitive. Bidding wars are common, with offers up to 60% above the asking price.
While the number of cash buyers is increasing, they still are not the most common type of offer.
If you have a good offer, consider taking it. On the other hand,, if you want to hold out for a cash offer, you have better odds to do so than you may have had in the past.
Are Cash-Only Buyers Better?
Consider the benefits of selling your house for cash – do these benefits meet your needs? Selling to cash only home buyers is one of the fastest ways to sell a house and it’s arguably the best way to sell a house. If you want to reduce your stress, it’s a great option to consider.
If you’re interested in receiving a top cash offer, contact us today.