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What Are The Pros and Cons of A Cash Offer On A House in Sacramento, California?

Sacramento Houses

Owning a home is an investment. It is a fact that investments do not always turn out as expected. There is a chance that property values might decline over time. 

The profitability of a property is not considered primarily when you select a house to live in it, but it might affect the property’s worth.

While accepting a cash offer on a house, you must consider the amount you want to spend on upkeep or improvements to the home, the price of homeowner’s insurance, the neighborhood’s high property taxes, and the cost of closing. It is essential to consider all these factors before making up your mind.

10 Best Places to Live in Sacramento 2023 – Sacramento, California for Every Lifestyle

Real Estate in Sacramento, CA

Sacramento, California, has an extremely competitive and dynamic real estate market. According to the most recent data from, the median listing price of homes in Sacramento, California, was $499K in July 2023, an increase of 8.7% from the previous year. 

The typical listing price per square foot was increased by 10.7% over the previous year to $329. The median sale price was $495K, an almost 2.9% decrease from the previous year. This is one of the reasons why people were seen accepting a cash offer on a house.

Sacramento as a Seller’s Market

Sacramento is considered as a seller’s market due to its volatile nature and short supply of houses. There are more buyers than sellers in the market, so the demand and supply rule applies here, resulting in high selling profits. 

Properties spent an average of 18 days on the market in July 2023, compared to 23 days the previous year in Sacramento, California. With an average sale-to-list ratio of 101.7%, properties typically raised around 2% more than their original demand price.

House for sale

The main playing factors determining the profit ranges in the real estate market of  Sacramento, CA, are the condition of the local economy, the rate of population growth, the intensity of supply and demand, and interest rates. 

My research regarding the population of Sacramento, California, reflects that it will have a population of more than 1.7 million people by 2023, its an increase of 9.4% since 2010. In my estimation, it will result in increasingly high demand for homes but a limited supply, which will further increase the rates.

Mortgage interest rates in Sacramento, California, are quite low, which makes it easier for buyers to finance their house purchases.

All Cash Offers in Sacramento

Accepting a cash offer on a house in Sacramento, California, especially in the current competitive and dynamic property market, is very common. From January 2021 to April 2021, 17.7% of home purchases were made entirely with cash in Sacramento, California, according to a Redfin survey. 

This is the highest percentage since 2015 when 18.4% of homes were bought with all cash. It is an increase from 13.9% in the same period the previous year.

Making a Cash Offer: How Do You Do It?

Let us go through the stages of making a cash offer and getting the acquisition of a house.

1- Determine the market worth of the property

The first and most critical stage in making a cash offer is to determine the property’s current market value. This can be accomplished through the use of web tools, interacting with a real estate agent, or employing an appraiser.

2- Consider your financial situation

Once you’ve determined the market worth, examine your budget and the utmost amount you’re willing to pay for the property.

You can make your offer to the seller or their real estate agent in person, over the phone, or in writing. When making an offer, provide the amount you’re willing to pay as well as any conditions that are crucial to you.

3- Negotiate

After you make your offer, the seller responds with a higher price or makes a counteroffer. This is your chance to bargain and reach a mutual arrangement. You have the option of accepting the seller’s counteroffer, rejecting it, or making your own counteroffer.

4- Secure Financing

If you need to finance the property, do so before you make a final offer. This entails securing a loan or mortgage and presenting papers showing your financial capabilities to purchase the property.

5- Sign a contract

Sign a purchase agreement or contract once you and the seller have agreed on the conditions of the sale. This will define the terms of the sale and serve as a formal agreement between both parties.

6- Close the transaction

After signing the contract, the sale process can begin. This includes a home inspection, completing the payment process, and transferring property ownership.

All cash offer

Pros and Cons of all Cash offers

Accepting an all-cash offer has several advantages for the seller, including:

  • When accepting a cash offer on a house, there is no need to wait for the buyer’s mortgage assessment, so the closing is simpler and faster.
  • Because there are no funding contingencies or concerns, the likelihood of the deal failing is unlikely.
  • It is wise to sell your house in cash and save money on closing costs because certain fees are routinely paid or waived in a cash transaction.
  • There are no fix-ups, no contingencies, and dealing is fairly fast. The buying process is completed within a matter of days.

Accepting an all-cash offer has the following disadvantages for the seller:

  • The seller often receives a lesser offer than a financed bidder since cash buyers usually demand a discount for their convenience.
  • Sellers usually have less bargaining power since cash purchasers have more negotiating power and demand compromises.
  • The seller often has to leave the ownership as early as possible since cash purchasers may want to close and take ownership of the home sooner.
  • Some of the benefits of making an all-cash offer for the buyer include:
  • Buyers may have a better chance of winning a bid because cash offers are more appealing to sellers.
  • You can save money on interest rates, closing costs, and mortgage fees by buying because you do not need to borrow money from a lender.
  • Buyers have additional flexibility and control over the deal because they are not limited by the lender’s limits or timeframe.
  • The buyer faces the following disadvantages when making an all-cash offer:
  • Buyers’ liquidity and flexibility may be reduced because they have less money accessible for other investments, crises, or home improvements.
  • The buyer may be subject to increased market risk since they may lose money if the home’s value falls or if they must sell quickly.

Is an all-cash offer the best option for you?

Making an all-cash offer is the ideal option for some homebuyers but a bad idea for others. Consult with your real estate agent and financial advisors to maximize both your current purchasing power and your long-term financial security.

Bottom Line

Cash payments make purchasers stand out from other bids and increase their chances of winning a bidding battle. You may be able to save money on appraisal fees, interest rates, and closing costs. 

Accepting an all-cash offer on your house can help you streamline the transaction, lessen the chance of financing falling through, and hasten the closing process. 

Simultaneously when purchasers pay in cash, they may have less money available for other investments, crises, or home modifications, which can limit their liquidity and flexibility. Additionally, it could put purchasers at a higher risk of losing money if the value of their homes drops. 


1. What are some of the most typical frauds involving cash offers on houses?

The most common frauds involving full cash offers on houses are false investors, bait-and-switch schemes, and falsely enhanced appraisals intended to trick owners into accepting lower offers or paying more fees and also to trick buyers into paying more than the value of the property. 

2. What are some common causes for a cash offer on a house failing to close?

It is rare for a cash offer on the house to fail to close, as cash offers are often considered more secure than mortgages or installment offers. An all-cash offer can fail to close due to title concerns, unforeseen repairs that must be addressed, and liens or other outstanding debts that must be settled before completing the sale.

3. What is the definition of an all-cash offer with a mortgage?

An all-cash offer with a mortgage is a type of home acquisition in which the buyer offers to pay for the property with cash and a mortgage loan. The buyer makes a big cash down payment and then obtains a mortgage to cover the remaining debt. This type of offer is appealing to sellers since it combines the certainty and timeliness of a cash offer with the buyer’s capacity to finance the acquisition.

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