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.
Read on to find out if a cash buyer is in your best interest.
Benefits of Selling Your Home for Cash
The pandemic has forced the housing market into a seller’s market, this means 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?”
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 many 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 in hand to pay. For this reason, an all-cash sale is the fastest way to sell a house!
Avoid Real Estate Fees
It’s common to hire a real estate agent when selling your house, since they makes finding a buyers much easier. In exchange, they get a commission from the sale. Understanding these fees is important when debating whether or not to sell to a cash buyer.
Alternatively, for all-cash sales, you don’t typically work with a real estate agent. Therefore, you don’t have to pay real estate fees.
Reduce Stress
Selling a house the traditional way is a stressful process; there is a lot of time and energy that goes into preparing a house for sale and accepting an offer, causing the selling process to take months to reach closure.
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 and easiest way to sell a house, but it’s arguably the best way to sell a house, too.
Are Cash Offers Common?
The traditional way of selling by 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, family emergencies, or job loss are reasons why someone might need to buy a house immediately. These buyers will occasionally pay in cash to improve their offer and chances of taking ownership quickly.
Evidently, cash buyers are becoming more common. According to the National Association of Realtors (NAR), 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.
So, if you have a good offer, consider taking it. On the other hand, if you want to hold out for a cash offer, you’ll have better odds now than you may have had in the past.
Conclusion
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.
At Selling.House, we guarantee to offer you a fair deal for your home without any pressure to sell. Our streamlined selling process is there to make the selling experience as quick and stress-free as possible.
If you’re interested in receiving a top cash offer, contact us today!
