28% of San Diego home sales in Jan. were cash

I suspect that most of the cash buyers are investors.

DataQuick: Slow winter season, lower-than-ever prices were likely factors

By Lily Leung

Almost three out of 10 homebuyers in San Diego County in January closed with cash, the highest it's been in 21 years, according to La Jolla-based DataQuick Information Systems.

Company spokesman Andrew LePage said 28 percent of new and resale homes bought in the county last month had no records of mortgages, matching the percentage of cash purchases one year ago during the same time.

The figures from this year and January 2010 are second to only the peak at May 1989, when 29.1 percent of home purchases were made with cash.

LePage said the historic high is likely due to lower-than-normal home prices and investors capitalizing on less competition during the holiday season, when most buyers are scrambling for presents, not homes. DataQuick numbers, which go back to 1988, show the monthly average of cash buyers is 12.6 percent in San Diego County.

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28% of San Diego home sales in Jan. were cash

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Other DataQuick highlights, California

--In January, 51.9 percent of those paying cash were absentee buyers. That means the property-tax bills will be sent to different addresses, potentially signaling the deals were made by investors.

--About 52 percent of the homes bought with cash in January had been foreclosed on in the previous 18 months.

--The median price for a home bought with cash last month was $160,000, down from $175,000 in December and $164,000 one year earlier. The median home price for all homes sold throughout California last month was $239,000.

Housing data may have understated extent of collapse

I posted this to remind you not to trust all the news put out by the National Association of Realtors.  And to realize that you must take into account the group releasing the information and to consider that they may have their own agenda "taint" its accuracy.

From Real Estate on msnbc.com:

A housing trade association is examining the possibility that the data it releases underestimated the collapse of the housing industry, the Wall Street Journal reported on Monday.

The National Association of Realtors, which issues the monthly existing home sales report that is closely watched by economists and financial markets, may have over-counted home sales dating as far back as 2007, the newspaper said in an article posted to its web site.

NAR's home sales count was at odds with calculations by CoreLogic, a California real estate analysis firm, according to the report. CoreLogic says NAR could have overstated home sales by as much as 20 percent.
An over-count of home sales may mean that there is a bigger backlog of unsold homes and that it will take longer for the U.S. housing sector to climb out of the deep hole it is already in, dragging on the broader economic recovery.

The crash of U.S. housing markets, in part because of shoddy lending practices, was at the heart of the economic meltdown that started in the United States and spread around the world.
  The U.S. recovery has been held back by the slow healing of housing markets, with high foreclosure rates hold down home values and sales.

NAR said the data could be revised downward this summer, the newspaper said.