Celebrity real estate agent Ryan Serhant sat down with TheStreet to explain how consumers are navigating an expensive housing market where cash is king.
Transcript:
CONWAY GITTENS: So tell me, what’s the biggest trend in housing right now?
RYAN SERHANT: The biggest trend? Yeah you know, cash. Cash is King. It’s amazing to me how many people have so much cash. You know, New York City specifically pre-covid, you’d have 30% to 35% of purchasers just paying all cash, whether they were doing a technical refi after closing or not. Today, it’s still hovering at just under 70% of all residential purchasers are done in all cash. I’d say that’s still the biggest trend.
CONWAY GITTENS: So what is the impact of that on the market, the fact that more people are paying with cash?
RYAN SERHANT: So one of the unique impacts, because I think our minds immediately go to well, so if you’re rich and you have a lot of cash, the housing market is going to favor you, right, unfairly. But what we’re starting to see is younger buyers come into the fold and co-purchase. If you would talk to me about people co-purchasing four years ago, three years ago, 10 years ago, I would have said that that’s a really, really hard thing to do.
CONWAY GITTENS: So what is co-purchasing? That’s a new phrase for some.
RYAN SERHANT: So you’ll see two people come together who are looking at rents and they’re saying, okay, rents are going up 3% to 10% a year. Inflation now looks according to today, like it might be cooling. I don’t know. The Fed is saying they’re going to cut rates maybe by the end of the year. I think we have a first rate cut. It’ll come sometime, let’s say in September. But regardless, let’s go and buy something together. Home ownership is a pathway to wealth, especially in the United States. It always has been. That’s not going to change. If we can get a great deal by pooling our cash together instead of being roommates on a rental, let’s be roommates on a co-purchase and we buy together.
And there’s different legal structures that you can do to make that palatable to everybody. But we’re starting to see that more and more. You’re starting to see it even a little bit in New York city, where you have condo boards, you know, there’s a bit more regulation and process here as New York is becoming a great primary residence for people who want to work from home, who never had the opportunity to live and work in New York before. But their jobs are based in Michigan or in California or, you know, in some of these places where they’re saying you know what? I can go and live in New York for the first time. And also you’re going to come with me. Great let’s actually buy something instead of just renting.
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