As Tenafly Home Sales Heat Up Some Buyers Waive Their Mortgage Contingency

Cash Is King

In today’s hot Tenafly market, many buyers often find that they have to up their bids and more often than ever before to offer “cash” in order and secure the deal.

This phenomenon is a result of limited inventory and an abundance of ready cash waiting to find its way to be invested.

Adding to the sense of urgency that many buyers are feeling  is the upward trend in interest rates.  As of the date of this post about 31% of all homes, condos, co ops and townhouses sold in Tenafly were bought with cash.  During 2012 only 26% of the transactions were closed  with “cash”.

To clarify,  the term “Cash” means that no mortgage contingency was part of the transaction which in turn also means that a buyer removed his/her ability to condition the purchase on obtaining a mortgage   in order and make their offer stronger and more appealing to the seller.

Another effect of “cash ” deals is that no appraisal is usually involved. This means that the buyer who is offering to purchase with cash is mostly willing to secure the deal without consulting an appraiser.  In  a hot market with shortage of inventory buyers are willing to take additional risks.

While a year ago buyers were still looking for “A steal” , today’s buyers are realizing that the market has changed in favor of sellers and that cash is king.

Projected Interest Rates