Buying a Home? Bring a Suitcase Full of Cash: Ritholtz Chart

Barry Ritholtz is a Bloomberg View columnist. He founded Ritholtz Wealth Management and was chief executive and director of equity research at FusionIQ, a quantitative research firm. He blogs at the Big Picture and is the author of “Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy.”
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Source: RealtyTrac

The chart above comes form the RealtyTrac Residential & Foreclosure Sales Report. It should come as no surprise that as rates rise, so too do all-cash purchases.

There are a few significant factors worth noting:

1) Last year, institutional investor purchases for residential properties (single family homes, condominiums and townhomes) accounted for 7.3 percent of all U.S. residential property purchases. This is up from 5.8 percent from in 2012 and 5.1 percent in 2011.

2) Median price of a distressed residential property -- in foreclosure or bank-owned -- was 38 percent below non-distressed property median ($108,494 versus $174,401) in December.

3) Bank-owned properties (REO) accounted for 9.3 percent of all U.S. residential sales last month, essentially unchanged from a year earlier (9.2 percent in December 2012).

This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.

Barry Ritholtz writes about finance, the economy and the business world for Bloomberg View. Follow him on Twitter @Ritholtz.

To contact the author on this story:
Barry L Ritholtz at britholtz3@bloomberg.net

To contact the editor on this story:
Toby Harshaw at tharshaw@bloomberg.net