New information from the National Association of Home Builders (NAHB) shows an interesting dynamic taking place with cash sales for homes.
According to MPA Page, NAHB’s analysis of recent census date showed that cash sales accounted for only 4.7 percent of new home sales, down from a peak of 9.5 percent in Q4 of 2014. The marks the lowest level since 2010.
By comparison, conventional mortgages were the dominant financing source for new home sales, coming in at 72.5 percent, the second-highest share since Q4 of 2014.
In an interesting note, the National Association of Realtors (NAR) noted that, despite the small percentage of cash finances in new home sales, a large share of existing homes are sold for cash.
In February 2017, cash sales made up 27 percent of existing home sales – the highest level since November of 2015.
Other data from the NAHB report showed that FHA loans placed second behind conventional loans at 14.8 percent, followed by VA-backed home sales with 8.1 percent.
In the period between the 2001 financial crisis and the recession in 2008, VA loans averaged just 2.9 percent, but increased significantly to 9.3 percent on average after the recession in 2009.
Opportunities for Manufactured Housing Abound
As the Daily Business News has reported prior, the traditional housing sector remains constrained by a dearth of properties available for sale.
Builders have cited a range of problems including shortages of labor and land as well as rising material prices. A recent survey showed that homebuilder confidence slipped in April from a near 12-year high in March.
The Daily Business News, MHProNews and MHLivingNews continue to make the case for manufactured housing as a viable solution to hope for the American Dream of home ownership at a reasonable price extensively, including Bloomberg making a statement to the same effect.
The myths, and the facts surrounding manufactured housing abound. To learn more, including why manufactured housing is the solution hiding in plain sight for many to achieve the American Dream, click here. ##
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Submitted by RC Williams to the Daily Business News for MHProNews.
