The demand for real estate in Florida created a surge in all-cash offers from buyers eager to purchase the limited number of properties available. As reported by the South Florida Sun-Sentinel, Broward County’s all-cash transactions for April 2021 numbered 435, an increase of 109 cash sales from 2020.
The year-over-year median sales price increased by 21%, with homes in Broward County selling on average for $464,000. Quick cash sales have also lowered residential property inventory. On average, homes come under contract within 14 days from their listing dates.
The dynamics of a deal may differ
Buyers with cash have greater negotiation control and a wider supply of properties to choose from to meet their objectives. Bankrate.com notes that investment buyers making all-cash offers for condos and homes appreciate earning income without paying loan interest.
Because of the lack of dependence on a mortgage, buyers avoid meeting the demands of a bank or financial institution that may affect a transaction. A property appraisal or inspection, for example, does not determine whether a bank can release a buyer’s funding in time for the closing.
The closing may proceed quickly
An all-cash offer generally means that a seller could reasonably anticipate a sale going through in about 30 days if he or she accepts it. Without a mortgage application, a closing may avoid the final underwriting process in which a bank officer verifies a buyer’s income and credit rating.
In a cash deal, buyers and sellers may also split escrow fees and closing costs equally. Documents may require little more than paperwork for a property’s title and a settlement agreement.
All-cash real estate transactions appear to have increased in Florida’s desirable markets. Buyers and sellers may wish to negotiate a range of considerations; an attorney may help facilitate a smooth closing.