A third of home buyers this year haven’t needed a mortgage. The proportion of people paying cash is “well above pre-pandemic levels,” according to the National Association of Realtors®.

It’s hard to compete with buyers who don’t need to wait for a lender’s approval. These wealthier buyers are shaping markets by snapping up the lion’s share of the homes in the markets they find desirable.

As Fortune puts it, “hopeful millennial and Gen Z first-time home buyers are up against deep-pocketed boomers and deep-pocketed Wall Street types.”

Deep Pockets: Corporate Buyers (and Many Retirees) Are Doing OK.

Longtime deed holders have built up equity in their homes. They can release cash by selling these homes. For some sellers, this averts the need to apply for a mortgage. Home flippers, too, have cash from their deals. And quick-cash-for-home buyers are also active in this market.

Why do so many of these people opt to use cash? They do it for a variety of reasons. Cash sales surge when a market is competitive. Or when people don’t like the current borrowing rates.

We still live in a competitive, pricey market because of the low supply, relative to the number of people who would buy if they can. And this leaves many non-investor buyers out of the market. Still. Many have been waiting for years.

To the average buyer’s frustration, cash buyers are significantly more prominent now than they were before the pandemic, according to economist Danielle Hale of Realtor.com.

Remember 2021? It was a year marked by bidding wars and cash purchases. About two million home buyers paid cash that year. The National Association of Realtors® said the numbers were unprecedented in the records.

Then, in 2022, mortgage rates increased, and people started hesitating to apply for mortgage loans. The numbers of cash buyers stayed elevated. Corporate buyers tend to ratchet down their activity when borrowing becomes more expensive. So their interest in the market began to cool from 2022 on. This is one reason the population of cash buyers was down to 1.4 million in 2024.

And yet we never came back down to the pre-Covid normal, when three in four buyers took out mortgages to buy homes.

Cash Is Especially Kingly in Florida.

Florida has an exceptional percentage of all-cash home purchases. Many of the buyers are older adults. They tend to move when they have a good deal of home equity, and want to retire to the Sunshine State. Or they want vacation homes. Both groups frequently pay in cash.

Other cash buyers in Florida are the investors who profit from the steady stream of retirees and international buyers. Studies of deed recordings indicate that LLCs and corporations make up a major portion of cash real estate deals.

The National Association of Realtors® cites a recent Cash for Home study showing West Palm Beach, Miami, and Jacksonville as all-cash buying hubs.

Fort Lauderdale, Orlando, and Tampa are all doing a brisk business in cash, too.

Where Else Is Cash in Charge? And What Areas Are Better for Borrowers?

Where else do we find cash dominating markets? Look at Maine, Mississippi, New Mexico, Montana, and Hawaii.

What about cities? In addition to Miami and other popular Florida cities, the high-cash markets include:

• San Antonio and Houston.

• Birmingham.

• Kansas City and St. Louis.

Buyers will find themselves up against far less cash dominance in Washington State, Rhode Island, Maryland, and the District of Columbia. Those places tend to attract a younger set of buyers. Plus, they offer plenty of access to local borrowing options. Same goes for the west coast job hubs of Portland, Seattle, and San José. Other good cities for mortgage borrowers are Denver and Virginia Beach. Better market conditions in these areas are bringing more mortgage borrowers in. But that doesn’t mean these cities are cheap.

Could Hopeful Mortgage Borrowers Make Headway in 2026?

Warren Buffett’s Berkshire Hathaway HomeServices points to the level of mortgage interest rates as a key obstacle for both hopeful buyers and sellers alike. But waiting for rates to go down is likely not the answer for hopeful buyers.

If mortgage rates do continue to drift downward, people who have the choice to borrow or not will be more likely to opt for mortgages. But people who don’t have that choice are going to be borrowing a lot, as home prices are rising faster than wages are.

Consider the reality. Home prices are up more than 50% since 2020.  How many household incomes have risen 50% in the past five years in order to keep up with that?

The interest rate on a 30-year, fixed mortgage now hovers a little over 6%. Many market watchers don’t think it’ll come down much more in the months ahead.

And some say we cannot possibly get to the necessary mortgage interest rate to make homes affordable again. Sydney Lake at Fortune quotes reporting by a market analyst with Zillow®,  Anushna Prakash. The analyst said we’d need mortgage rates to dip below 4.5% if we want to see affordable listings for typical buyers. And that’s “currently unrealistic.”

Prakash said that a typical home in New York, Miami, or popular California cities would need to be available at zero percent interest — and even then, these homes wouldn’t be financially accessible to most hopeful buyers.

The Takeaway From All of This?

In a nutshell: Those who can purchase a home today would likely be better off doing so than trying to benefit from a rate drop in the months ahead. Rates may come down somewhat, but aren’t expected to plummet.

Even if rates were to drop significantly at some point ahead, that would draw more cash buyers from corporations and LLCs into the market.

And at the end of the day, mortgage interest is only one aspect of the challenging financial project of acquiring a deed.

What can be done to make deeds affordable? Read some examples of how state lawmakers can help.