How Much Do Cash Home Buyers Offer?

The amount an all-cash homebuyer offers to purchase a home is determined by several factors including what other buyers are offering, how long the house has been on the market, their particular motivation for making the purchase, and their available funds.

All-cash sales carry the potential of many benefits for both parties involved in the transaction including less reliance on banks and loan approvals, more flexibility with the terms of the purchase, quicker funding, and quicker closing proceedings.

How Can You Buy A House With Cash?

Typically, a cash home buyer acquires the liquidity to cover the purchase price of a property from savings, a particular investment, or a windfall of cash. While this is not always the case, it is most common. Whatever the situation may be, cash buyers are often highly motivated to purchase a home quickly. They also don’t have nearly as much red tape as someone following the traditional sale process.

To submit your cash offer as a cash buyer, you either communicate directly with the seller, with the seller’s real estate agent, or you submit the offer formally through your real estate agent. If your offer gets accepted, you’ll likely be expected to make an earnest money deposit, and follow through with the terms you and the seller have agreed upon up to and including the time of sale.

Want to Know What Cash Buyers Will Pay for Your Home?

If you want to know the value of your home, and how much a cash buyer can expect to pay for your home, check out Clark County Market Values’ online home valuation tool. If you take two minutes to fill out the questions, they will automatically provide your home’s valuation based on current market value and conditions.

Who Can Buy A House With Cash?

Cash purchases are made by a variety of individuals. Maybe it’s an older couple that has been saving for some time and has finally saved enough money to pay cash. It could be someone who is a real estate investor, someone who has recently gained access to a large inheritance, or even someone who is cashing out their long-term investments to fund the purchase. Most often, investors and established individuals are the cash buyers in the real estate market. Young people and young families typically don’t have that kind of dough.

Why Buy a House With Cash?

An individual could be looking to buy a house with cash as an investment for one of several reasons: because he or she likes to flip homes and make money that way; because someone is planning on moving into the place and renting out other parts of it; or because an existing tenant within his or her property is moving out and they would like to buy the next tenant’s lease contract (this is very common among landlords).  Whatever the reason, these individuals typically have enough liquidity and access to capital (from their savings, managed investments, etc.) to pay cash for a house and close quickly.

Many people also feel motivated to make cash offers because they’re often just so much easier than worrying about things like the type of mortgage financing involved, acquiring a mortgage interest deduction in taxes down the road, the available interest rate on different loans, home appraisal, lender fees, and the list goes on. Cash offers and cash sales are just easier.

When Is An All-Cash Offer Most Likely?

An all-cash offer is most likely when the home has been on the market for some time and there have been several price reductions, and the seller is growing desperate.

Desperation might lead them to accept less than their asking price just so they don’t have to keep waiting with no results.  As you can imagine, if people are seeing an ad that says “we will sell at $450,000,” and then they see that three months later it’s still sitting on the market and now the price is $425,000, they may be willing to go down to $420,000 or even less. As an all-cash buyer making an all-cash offer on a house, you may be able to make the owner of this property take your offer seriously because it’s not contingent on anything (like searching for mortgage financing).

Another instance where cash buyers might swoop in is to snag a highly anticipated, or highly valuable piece of property. This is a common practice for investors who keep an eye on their local market like a hawk, waiting to swoop in on their preferred type of residential or commercial real estate. Sometimes, if a cash buyer is really serious, they’ll provide an earnest money deposit that far exceeds expectations and offer to cover some seller closing costs in the purchase agreement. This shows they are serious because they are willing to put more skin in the game. All that being said, just how much money do cash buyers pay when they’re trying to purchase a property?

Cash Home Buyer Offer Price

The answer: It depends. There’s no dollar amount to be listed because there is simply too much variety. However, if a buyer is claiming to be a cash buyer, they’re likely prepared to fund their all-cash offer in full without the aid of mortgage or secondary financing. If you claim to have the cash, you better be able to prove it, or sellers may get freaked out and feel misled.

The motivation behind the sale will also determine if the buyer lowballs or overvalues their offer to acquire the property. If they really want it, they might offer full asking or over to acquire the property. On the other hand, if they see any desperation on the part of the seller, they may make a cash offer for less than asking with the tradeoff that they can do a quick closing, get the seller their money quickly, save money on closing costs, sometimes cut out a real estate agent, and not deal with a mortgage loan.

Interested in Making a Cash Offer?

Cash home buyers typically have a high net worth and a lot of cash on hand. They can make all-cash offers because they don’t need financing to close the real estate transaction. A cash sale has many benefits for both parties involved, as the seller isn’t at risk of losing their money due to an incomplete sale, closing costs stay low, and the buyer doesn’t lose out on the purchase if some type of mortgage loan falls through.

If you plan on making strictly cash offers on properties in the future, be sure you’re prepared to prove that you actually do have that kind of dough, or sellers will question your motives and feel like they’re being taken advantage of.

If you’re interested in selling and are motivated by the prospect of an all-cash buyer making a cash offer on your property, or you’re not sure if you’re in a position to conduct a cash sale, start by finding the current value of your home using the online home valuation tool by Clark County Market Values. It takes two minutes and they’ll give you an accurate current valuation of your property. Visit Clark County Market Values’ website today for more information.