Who can compete with that? Cash offers dominate the housing market
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All-cash buyers are rewriting the rules of the US real estate market in 2025. With mortgage rates remaining above 6.5 percent, buyers who can skip the loan process altogether are dominating sales, outpacing traditional mortgage-backed offers and intensifying the affordability gap.
According to a recent Realtor.com report, nearly 33 percent of all home sales in the first half of 2025 were all-cash transactions. While slightly down from 2024, the number remains far above pre-pandemic levels, where cash buyers made up roughly 28 percent of all purchases.
The result is a highly competitive market where speed and certainty matter more than financing strength. Sellers are leaning toward cash buyers who can close quickly, avoid mortgage-related delays, and offer fewer contingencies. That leaves many first-time buyers, who often rely on mortgages and down payment assistance, at a disadvantage.
“High-wealth buyers, investors, and those with significant equity can move quickly and often win out in competitive situations,” said Danielle Hale, chief economist at Realtor.com. “For traditional, mortgage-reliant buyers, this can add another hurdle in an already challenging affordability environment.”
The new shape of the market
Cash buyers are most active at the market’s extremes. Data shows that more than half of homes priced above $2 million were paid for in cash. At the same time, two-thirds of homes under $100,000 were also bought with cash, particularly in rural or low-cost areas where mortgage access is limited.
This creates a U-shaped cash distribution, with both luxury buyers and budget-conscious investors bypassing traditional financing. In markets like Mississippi and West Virginia, low property values and tight lending standards are fueling a cash-heavy buyer pool. Meanwhile, states such as Idaho, Montana, and Maine are seeing an influx of cash offers from out-of-state buyers looking for vacation or investment properties.
Older homeowners with high equity and repeat buyers who profited from prior sales are also driving the trend. Their ability to leverage gains and avoid interest costs makes them more resilient in today’s rate-driven market.
Locked out by rates, mortgages, and momentum
Mortgage-backed buyers are not only losing bidding wars but also seeing fewer options. Despite a 10.6 percent rise in inventory this year, affordability remains constrained. The average homebuyer today must contend with elevated prices, higher monthly payments, and stricter underwriting standards.
With cash buyers taking a growing share of listings, competition among financed buyers is further intensified. This dynamic has long-term implications. As more homes are bought with cash, housing access becomes increasingly dependent on personal wealth and existing equity.
“If mortgage rates fall, we could see financed buyers regain ground,” said Realtor.com analyst Hannah Jones. “But for now, cash remains a powerful competitive advantage.”
In a market where liquidity beats credit, the American dream of homeownership looks very different depending on how you pay for it.
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