Cash rules everything around Cleveland's housing market
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Nearly half the home purchases in metro Cleveland from January 2011 to February 2024 were made with cash.
Why it matters: All-cash homebuying eliminates the hassle of loans and gives an edge in a competitive market, especially in Cleveland, one of the nation's poorest cities.
By the numbers: 48.8% of home purchases were made with cash, well above the national average of 34.5%, according to Redfin.
- Cleveland had the third-highest percentage of any city, behind only Jacksonville and West Palm Beach, Florida.
State of play: An increasing number of such purchases in recent years have been made by investors, many of which are out of state, according to The Washington Post.
- In 2021, 16% of homes purchased in Cleveland were bought by investors, up from 7% in 2015.
The intrigue: The influx of investors — companies or individuals who usually don't live in the properties and look to either flip them to new buyers or rent them — has especially been prominent in Black neighborhoods, according to The Washington Post's analysis.
- Blacks, who face more obstacles to homeownership, make up the second-largest demographic in the Cleveland metro area behind whites.
What they're saying: Last August, Sen. Sherrod Brown sponsored the Stop Predatory Investing Act, which would limit tax breaks for local investors buying up local homes.
- "So many families who have worked for years saving to buy a house end up getting outbid over and over by outside investors, and they can't afford to compete," Brown said.
The latest: A hearing on the bill took place in April. The Senate has yet to vote on it.
The bottom line: Zillow predicts Cleveland will be a hot housing market in 2024.
- If recent trends continue, a large percentage of homes purchased will be done with all cash and by corporate investors.