All-Cash Home Purchases Save Buyers 10% Compared to Mortgages
A new study reveals that all-cash home buyers pay significantly less than those financing with a mortgage, highlighting the financial benefits and market implications.
- Researchers find all-cash home offers result in a 10% savings compared to mortgage-financed purchases, with the discount varying based on buyer's financial profile and local market conditions.
- The study, conducted by the University of California San DiegoRady School of Management, indicates that mortgage buyers can pay up to 17% more in areas with higher deal failure rates.
- About a third of home purchases are all-cash deals, a significant factor affecting real estate market dynamics and property values.
- U.S. policy subsidizes $8 trillion in mortgages to promote homeownership, suggesting a need for policy adjustments to reduce friction between mortgage buyers and sellers.
- The rising trend of all-cash purchases is contributing to an older average age of first-time homebuyers and potentially eroding the long-term investment value of properties.
Times of San Diego 
