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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: KyrosL who wrote (25571)12/1/2004 10:29:33 PM
From: Amy JRead Replies (3) of 306849
 
According to a local real estate broker in 1999, more than 90% of local home owners that purchased a one million+ dollar home paid cash. He said, it's the ones with the smaller mortgages that don't pay cash. That was his experience. Like you, I would have thought it was just the reverse.

On a different note, for some reason brokers prefer if you take out a loan - do they get a cut out of the real estate loan or something like that?

On a related note, when I bought my car with cash, I refused to tell them whether or not I was going to take a loan until after the price was negotiated. For some reason the guy assumed I was going to take out a loan (maybe because of how old my car being replaced was), and he seemed to think his goal was to convince me to take out a loan from them rather than a bank. He seemed totally surprised when I paid cash (actually, I put most of it on my credit card to get the frequent flyer mileage and then paid the credit bill in full.)

GM makes only 26% of its profit from its car sales, the majority of their profit is from auto loans. I suspect the other auto manufacturers are similar.

Auto dealers don't especially like people like me that pay cash and buy a new car once every ten years.

Regards,
Amy J
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