All-cash home purchases have remained increasingly attractive to buyers with the resources to forgo financing, likely the result of mortgage interest rates remaining elevated since the end of the pandemic.
That’s according to a new report from the National Association of Realtors that found that for the last three years, more than a quarter of all home sales nationwide involved all-cash buyers who did not require a mortgage.
NAR economists said that’s not a coincidence. It said that from 2022 to 2025, mortgage interest rates surged from their pandemic-era record lows, peaking near 8% in fall 2023, before settling into the low to mid 6% range this year.
Borrowing is More Expensive
Those elevated rates have made borrowing more expensive, mostly sidelining first-time and lower-income buyers.
Harrison Polsky, a real estate agent at Douglas Elliman in Dallas, agreed that there is a strong correlation between climbing mortgage rates and cash sales.
“As mortgage rates increased, buyers with access to capital increasingly chose to close with cash or cash-equivalent financing,” Polsky told Realtor.com. “It became a bridge strategy. Close as cash to avoid rate and underwriting friction, then revisit permanent financing later through private banks or wealth advisers at more favorable terms.”
Existing homeowners have benefitted from rising home equity, Realtor.com said, giving them the edge to make cash offers on their next home or a vacation property.
Realtor.com said that as of October, all-cash buyers accounted for 29% of home sales nationwide, up from 27% the year before and 19% five years prior.
These findings mirror a recent report from Realtor.com showing that roughly one-third (32.8%) of homes sold in the first half of 2025 were paid for in all cash.
Realtor.com Senior Economic Research Analyst Hannah Jones said in the report “Cash Is King: Trends in All-Cash Home Sales” released in October, there are clear advantages to buying with cash, from avoiding high borrowing costs and financing contingencies, to closing more rapidly.
Polsky says that choosing to pay all cash removes financial uncertainty and instantly enhances a buyer’s credibility with the seller, giving them greater negotiating leverage.
“Put simply, as borrowing becomes more expensive, paying with cash starts to look like a smarter, more competitive choice,” Amethyst Marroquin, Research Assistant of Member and Consumer Survey Research at NAR, wrote.
Who Are All-Cash Buyers?
What type of properties attract cash buyers, according to NAP?
Based on NAR’s Confidence Index covering the last 10 months, cash buyers are typically existing homeowners looking for vacation homes, or investors acquiring rental properties.
All-cash buyers gravitate toward vacation or second homes, as well as investment properties.
All-cash buyers gravitate toward vacation or second homes, as well as investment properties.Getty Images
From January to October 2025, NAR said that 57% of vacation-home buyers and 56% of investment buyers paid in all cash.
An analysis of deed data carried out by Realtor.com researchers this fall revealed that institutional investors using limited liability companies and corporate entities were at the forefront of cash purchases.
Conversely, all-cash deals made up only 19% of primary home purchases, with 81% involving financing, NAR’s report showed.
NAR said that an overwhelming share of first-time buyers of primary residences– those they plan to live most of the time — continue to rely on home loans: In 2025, 8% of these buyers made all-cash purchases, according to data from NAR’s “Profile of Home Buyers and Sellers.”
Meanwhile, a growing number of repeat primary residence buyers—existing homeowners looking for an upgrade—pay in all cash.
In 2025, one-third of repeat buyers made all cash offers, down slightly from last year, but up from 10% in 2023.
The post NAR Report: High Mortgage Rates Steer Homebuyers Toward All-Cash Purchases first appeared on The MortgagePoint.
