51 percent of all of Florida’s real estate sales are cash home sales. This makes Florida the leader in the United States for cash home sales. On average, national home cash sales are around 33% which is higher than last years rate of around 20%. After the recession, there was a shortage of houses for sale as well as more strict regulations put on mortgage lending. Cash offers are a lot more attractive to sellers as they know that they will have the money right after the papers are signed. It surpasses much of the financing needed in a non-cash agreement, making someone paying cash a way to help them win a bidding war. This makes it very difficult for first0time buyers relying on financing. It it a lot more difficult to qualify for financing these days, and with the high demand and higher supply of cash buyers, young homebuyers are finding it more difficult to purchase homes.
The housing crisis was caused by poor mortgage lending tactics to buyers that were not able to reach their mortgage agreements. This was the era of sub-prime mortgage lending. In the wake of the 2008 housing crisis, banks were forced to put more strict regulations on mortgage lending, making it more difficult for people to buy homes who were on the fringe. Less and less people were then applying for mortgages because they were cut from being qualified. This lead towards a decrease in the supply of houses being built. This lack of supply made it even more difficult for people on the fringe since buying houses using cash became much more attractive to sellers and easier for buyers.
Purchasing a home in Miami (and essentially everywhere else in the United States) is much less expensive than renting. Take a look at Raanan Katz’s blog post on renting vs. purchasing homes by clicking here.