Single-family home and condo sales through August were on pace for an eight-year high nationwide in 110 out of 204, or 54 percent, of metropolitan statistical areas with sufficient sales data, according to a new report from RealtyTrac.com. The sales report also shows: • All-cash share of home sales bounced back in August. • FHA buyers represented 23 percent of August home sales. A total of 1,947,028 U.S. single-family homes and condos sold through August in 2015, up 5.4 percent from the same time period a year ago, to the highest total for the first eight months of the year since 2007, when there were 2,069,963 sales. The 110 metro areas on pace for at least an eight-year high in home through August included: • Los Angeles • Phoenix • Dallas • Denver • Riverside-San Bernardino in Southern California • Detroit • Seattle • Tampa • Minneapolis • Portland Of the 204 local markets, 58 (28 percent) were on pace through August to reach nine-year highs in home sales in 2015, and 22 (11 percent) were on pace through August to reach 10-year highs, including Denver; San Diego; the Florida markets of Sarasota, Naples and Palm Bay; along with Grand Rapids, Mich., and Reno, Nev. “The continued strength in sales volume across a wide spectrum of markets in August indicates that shockwaves from recent global stock market instability have not weakened the housing recovery and in fact there is evidence that the instability has fueled more demand for U.S. real estate,” Daren Blomquist, vice president of RealtyTrac, said in the release. “The share of cash sales nationwide in August bounced back from a seven-year low in July, and the month-over-month increase in cash sales share was more pronounced in markets that have traditionally been magnets for foreign cash buyers, including Boston, Las Vegas, San Francisco, Seattle and New York,” Blomquist said. “We are seeing more globalization as Southern California has become a destination for international buyers,” said Mark Hughes, chief operating officer with First Team Real Estate, covering the Southern California market. “Eighty percent of new construction in Irvine last year was sold to Chinese buyers. International buyers are driving home prices up and sometimes out of reach for many local residents.” “Sales have been very brisk in the Reno-Sparks market,” said Craig King, COO at Chase International brokerage, covering the Lake Tahoe and Reno, Nev., markets. “Seasonally the market may follow a traditional fourth-quarter slowdown, but overall we expect sales to remain very strong with this influx of new people from outside the marketplace and more new first-time buyers coming into the area to fill initial jobs with businesses like Tesla and Switch expanding into the local area.” Miami, New York, Las Vegas post highest share of cash home sales All-cash sales accounted for 24.5 percent of all single-family home and condo sales in August, up from a seven-year low of 23.6 percent in July but still down from 26.7 percent of all sales in August 2014 and down from a peak of 39.6 percent of all sales in February 2013. Among metropolitan statistical areas with a population of at least 1 million, those with the highest share of cash sales were Miami (48.7 percent), New York (44.7 percent), Las Vegas (42.2 percent), Raleigh, N.C. (39.6 percent) and Tampa (37.6 percent). “The South Florida market is more balanced and healthier today than in the past decade. With an abundance of financing options we are seeing strength in the first-time homebuying market,” said Mike Pappas, CEO and president of the Keyes Company, covering the South Florida market. “The spike in home values has strengthened the move-up market, and our international buyers and investors weigh in heavily as cash buyers.” “Cash buyers are patiently waiting on the sidelines as inventory increases slightly and brings more selection to the market,” said Al Detmer, broker associate at RE/MAX Alliance, covering the Greeley market in Colorado, where cash sales accounted for 17.4 percent of all home sales in August, down from 24.4 percent a year ago. “FHA loan limits hinder buyers over $272,000, while sellers at or below FHA loan limits select buyers that have more skin in the game with larger down payments.” Las Vegas, Riverside-San Bernardino and Baltimore with highest share of FHA buyers The share of buyers using Federal Housing Administration (FHA) loans — typically with an average down payment of about 3 percent — continued to increase in August, when 23.1 percent of all single-family and condo sales were to FHA borrowers, up from 23.0 percent in July and up from 17.8 percent in August 2014. “It wasn’t just cash buyers that kept home sales volume strong in August,” Blomquist noted. “The share of buyers using FHA loans in August increased 30 percent from a year ago, and the year-over-year increase in the share of FHA buyers was 50 percent or more in markets such as Nashville, Phoenix, Colorado Springs, Portland and San Diego. Those markets with a solid and fast-growing share of FHA buyers are poised for longer, more sustainable growth going forward than markets that are more dependent on capricious cash buyers.” Report methodology: The RealtyTrac U.S. Home Sales Report provides percentages of distressed sales, and all sales that are sold to cash buyers by state and metropolitan statistical area. Data is also available at the county and ZIP code level upon request. The data is derived from recorded sales deeds, foreclosure filings and loan data. Statistics for previous months are revised when each new report is issued as more deed data becomes available.Definitions: All-cash purchases: sales where no loan is recorded at the time of sale and where RealtyTrac has coverage of loan data.
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