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33 » VISIT US ONLINE @ DSNEWS.COM POTENTIAL BUYERS AREN'T RULING OUT RENTING JUST YET... e competitive homebuying market brought on by short inventory supply is causing potential buyers to keep their renting options open, according to the latest Zillow Group Report. Zillow found that on average renters spend about 10 weeks looking for a new place. Buyers spend about 17 weeks. Add to that the fact that at almost half of all buyers are first-time buyers, and 54 percent of buyers do not get the first house they bid on, and suddenly it forces house hunters to consider staying in rental properties longer, Zillow reported. e times only get longer the lower the income of the buyer. Low-income renters spend on average 12 weeks looking for a rental, Zillow found. And for many renters, buying is not a financial option. e median income of homebuyers is $87,500 a year, while renters make, on average, $37,500. "e line between renting and buying is blurry, and that's a sign of the times," said Zillow chief marketing officer Jeremy Wacksman. "It's difficult and time-consuming to find a home to move to, especially in competitive housing markets. Savvy shoppers have a Plan B, hoping to buy if it works out, but willing to sign a lease for a home if they don't make a deal by the time they need to move." According to Zillow, among those who bought a home in the last 12 months, 66 percent of millennials considered renting as well. Just over half (54 percent) of Generation X buyers considered renting, as did 32 percent of Baby Boomer buyers. Younger renters are also more flexible when looking for a home to rent—63 percent of Millennials and 59 percent of Generation X renters considered buying while looking for a rental. Among renters over 50, most did not consider buying at all. Renters, once an afterthought to many in the housing industry, have become a significant pool. Last week, the U.S. Census Bureau reported the homeownership rate hit 63.5 percent in Q 3. While that's an improvement over Q2, it's barely about a half- century low. LOW REO INVENTORY REDUCES MARKET SHARE OF CASH SALES With less REO properties available for investors, declines in REO sales triggered a further decline for national cash sales. Not all states experienced the same level of decline though, according to the latest Cash Sales and Distressed Sales Data Report from CoreLogic. Cash sales accounted for 29.7 percent of total home sales in July 2016, down 1.9 percentage points year over year from July 2015. Prior to the housing crisis, the cash sales share of total home sales averaged approximately 25 percent. CoreLogic reports that if the cash sales share continues to fall at the same rate it did in July 2016, the share should hit 25 percent by mid-2018. REO sales, no surprise, had the largest cash sales share in July 2016 at 57.6 percent. Following behind, resales had the next highest cash sales share at 29.4 percent with short sales close behind at 28.1 percent and newly constructed homes at 15 percent. While the percentage of REO sales within the all-cash category remained high, REO transactions have been in decline since peaking in January 2011. REO sales made up 4.3 percent of the distressed sales share of total home sales while short sales made up 2.9 percent in July 2016. Most notably, CoreLogic reported that the distressed sales share of 7.2 percent in July 2016 was the lowest distressed sales share since September 2007. As with cash sales, the pre- crisis share of distressed sales was traditionally significantly than that of the post-crisis share. If the current year-over-year decrease in the distressed sales share continues, it will reach that "normal" 2-percent mark in mid-2018. Eight states did record higher distressed sales shares in July 2016 compared with a year earlier, though. Maryland had the largest share of distressed sales of any state at 19.4 percent, followed by Connecticut at 18.6 percent, Michigan at 17.8 percent, New Jersey at 15.6 percent, and Illinois at 15.5 percent. North Dakota had the smallest distressed sales share at 2.5 percent. While some states stand out as having high distressed sales shares, only North Dakota and the District of Columbia are close to their pre- crisis levels, says CoreLogic, each within one percentage point. On the cash sales side, New York had the largest share of any state at 44.6 percent, followed by Alabama at 43.6 percent, Florida at 39.6 percent, New Jersey at 37.3 percent, and finally Indiana at 37 percent.

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