Monday, June 1, 2026
Cash home purchases fall to lowest March level since 2020 as buyers opt for financing
Fewer US homebuyers are paying cash for homes as mortgage rates ease and economic uncertainty encourages buyers to preserve savings, according to a new Redfin report.
Less than 29% of U.S. homebuyers paid cash for their homes in March, the lowest share for that month since 2020, as easing mortgage rates, a more buyer-friendly housing market and economic uncertainty reduced the appeal of all-cash offers, according to a report released by Redfin.
The real estate brokerage said 28.8% of home purchases nationwide were made in cash in March, down from 29.8% a year earlier and tied with 2021 for the lowest March level in five years.
The share of all-cash purchases had climbed to nearly 35% in 2023, when mortgage rates approached 8%, prompting buyers with sufficient resources to avoid high borrowing costs by paying outright. Since then, mortgage rates have eased, averaging 6.18% in March, reducing the incentive to bypass financing.
At the same time, housing markets across much of the country have shifted in favor of buyers, with more homes for sale and less competition among purchasers. As a result, buyers are less likely to rely on cash offers to gain an advantage in bidding wars, according to Redfin.
Economic uncertainty has also influenced purchasing decisions. Concerns about inflation, rising oil prices, geopolitical tensions and the possibility of a recession have led some buyers to preserve cash reserves rather than invest large sums in real estate.
"Cash buyers have retreated," Beth Behling, a Redfin agent in Chicago, said in a statement. "Buyers are feeling jittery about the economy, and it's not financially comfortable to drop a huge chunk of money into a home; they may prefer to have more cash on hand."
Financial advisers note that some affluent buyers may benefit from financing a home purchase while keeping cash invested elsewhere, particularly if investment returns exceed mortgage interest rates.
The prevalence of cash purchases varied widely by market.
Among the metropolitan areas analyzed by Redfin, cash purchases were most common in Cleveland and West Palm Beach, Fla., where 51.1% of home sales were completed without financing. They were followed by Detroit at 45.8%, Riverside, Calif., at 38.1% and Fort Lauderdale, Fla., at 38%.
Redfin attributed the high share of cash transactions in South Florida markets to affluent retirees and second-home buyers. In lower-cost markets such as Cleveland and Detroit, relatively affordable home prices make outright purchases more attainable for both investors and owner-occupants.
Cash purchases were least common in Western markets with higher home prices. Seattle recorded the lowest share at 17.6%, followed by Oakland at 18.4%, Sacramento at 19.9%, Los Angeles at 20.5% and San Diego at 20.7%, the report stated.
In those higher-cost markets, even wealthy buyers often finance at least part of a purchase, according to Redfin, because buying a home outright can require several million dollars, limiting the number of households able to pay entirely in cash.
The real estate brokerage said 28.8% of home purchases nationwide were made in cash in March, down from 29.8% a year earlier and tied with 2021 for the lowest March level in five years.
The share of all-cash purchases had climbed to nearly 35% in 2023, when mortgage rates approached 8%, prompting buyers with sufficient resources to avoid high borrowing costs by paying outright. Since then, mortgage rates have eased, averaging 6.18% in March, reducing the incentive to bypass financing.
At the same time, housing markets across much of the country have shifted in favor of buyers, with more homes for sale and less competition among purchasers. As a result, buyers are less likely to rely on cash offers to gain an advantage in bidding wars, according to Redfin.
Economic uncertainty has also influenced purchasing decisions. Concerns about inflation, rising oil prices, geopolitical tensions and the possibility of a recession have led some buyers to preserve cash reserves rather than invest large sums in real estate.
"Cash buyers have retreated," Beth Behling, a Redfin agent in Chicago, said in a statement. "Buyers are feeling jittery about the economy, and it's not financially comfortable to drop a huge chunk of money into a home; they may prefer to have more cash on hand."
Financial advisers note that some affluent buyers may benefit from financing a home purchase while keeping cash invested elsewhere, particularly if investment returns exceed mortgage interest rates.
The prevalence of cash purchases varied widely by market.
Among the metropolitan areas analyzed by Redfin, cash purchases were most common in Cleveland and West Palm Beach, Fla., where 51.1% of home sales were completed without financing. They were followed by Detroit at 45.8%, Riverside, Calif., at 38.1% and Fort Lauderdale, Fla., at 38%.
Redfin attributed the high share of cash transactions in South Florida markets to affluent retirees and second-home buyers. In lower-cost markets such as Cleveland and Detroit, relatively affordable home prices make outright purchases more attainable for both investors and owner-occupants.
Cash purchases were least common in Western markets with higher home prices. Seattle recorded the lowest share at 17.6%, followed by Oakland at 18.4%, Sacramento at 19.9%, Los Angeles at 20.5% and San Diego at 20.7%, the report stated.
In those higher-cost markets, even wealthy buyers often finance at least part of a purchase, according to Redfin, because buying a home outright can require several million dollars, limiting the number of households able to pay entirely in cash.
