Cash Buyers Are Buying More Houses

Cash buyers account for a large percentage of real estate transactions in the US.

What does that mean for real estate wholesalers, rehabbers, buy & hold real estate investors and the average Joe?

When the US real estate market began recovering in 2013 Bloomberg reported that “all cash home purchases made up almost 50% of all transactions. At least 14% of all transactions were being made in cash by institutional investors.” Those numbers were far higher in some markets where cash buyer ratios may have reached up to 65% or more. That has changed since more lenders are offering financing, and interest rates remain relatively low. Many people have also been able to repair their credit scores over the last 8 years.

This amount of cash buyers is very significant for the average Joe aspiring to become a real estate wholesaler, rehab and buy & hold investor. Lack of money and experience is the biggest fear and most common excuse newbie investors give for not getting started, or for failing to step up to reach their goals. Yet, clearly there are billions of dollars out there in search of residential and commercial real estate. There are billions for building, borrowing, buying, and investing in the opportunities you’ll present in the near future once you start learning and mastering my system. It’s yours to leverage and benefit from if you have the right mindset and game plan.

The big question is how you can position yourself and present your opportunities as the best choice for buy & hold, rehabbers, lenders both private and traditional. What is unique and superior about your investment opportunity compared to the millions of others out there? Building personal and corporate brand visibility can help in these efforts by increasing trust, connection and credibility. Developing and strengthening relationships is key too. You have to develop the know, like, and trust, trifecta. And that is exactly what I’ve been teaching my student partners over the years.

Leveraging non-bank institutional cash, and private money is becoming a more and more popular as people put less in the bank, and as the banks in turn have less to loan.

However, it is also important to note that not as many of these buy & hold investor buyers still own these properties free and clear. They have securitized them, refinanced them, taken out lines of credit on them, or have encumbered them with complicated blanket mortgages. They may have some equity cushion, but they aren’t all 100% equity. This means two things. First; that the market as a whole isn’t as equity rich as some think. Secondly it means that these buyers should still be flush with liquid cash. They have bought, refinanced, and have the cash to invest again. Investors that are ready to hustle and put the time and effort in on the front lines can be well positioned to help those without capital.

I”ll See you at the closing table,

Marcel Umphery the “R.E.I. Successmaker”