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All-Cash Transactions on Rise at High End of Market

All-cash sales for luxury properties are on the rise, according to Irvine-based CoreLogic, which provides financial, property and consumer analytics, and tracks current trends.

Company analysts say that more international buyers are investing their cash in high-end properties as a safe alternative to global markets. Data shows that more than half of foreign homebuyers in the U.S. chose to pay in cash last year.

Cash has flowed into Orange County in that same wave.

“Year to date, I’ve closed four escrows and have two currently in escrow totaling nearly $40 million in sales,” said Ron Millar of Arbor Real Estate. “Four of those six sales were all-cash.”

“I personally have seen an increase in all-cash buyers over the last two years,” said Adrienne Brandes of Surterre Properties. “In Newport Beach, it’s about 35%. My specific clients who are mostly over $4 million, it’s about 60% to 70% all-cash.”

Ninety percent of Brandes’ buyers are local. “Although,” she added, “the highest sale price in Corona del Mar village in the last two years was my buyer from Canada at over $20 million.”

Andre White of the Cain White Group, HÔM Sotheby’s International Realty agrees that all-cash transactions have been on the increase. “Over the past few three, four years, the number of all-cash transactions has definitely increased, mainly with the foreign buyers,” he said. “Forty to fifty percent of my team’s transactions are all-cash.”

White said that in his estimation 30% of OC luxury homebuyers in general are international. “(There is) still a large influx of Asian buyers, mostly Chinese, and also a lot of Saudi buyers, Indian, Russian and Canadian.”

Millar pointed out that while only one of his sales this year was from an international buyer, he stills sees that buyer profile as very active in the high-end marketplace and said most international buyers are Chinese. He concurred with CoreLogic’s assessment that those buyers are searching for a protected place for their money.

White sees foreign buyers seeking out Orange County homes for a different treason. “Having their children educated in the U.S. is the main reason for these purchases. But they also are looking for a safe place to invest their money versus keeping it in their home country, where there’s a lot more political and economic uncertainty.”

Brandes offered a more general view: “I believe more high-wealth individuals are investing in real estate. It’s tangible and over time consistently goes up. After the 2008 crash, we were down about 40% in terms of value,” she said. “Today we have more than made up for that. Additionally, even though prices are high, desirable properties are selling with multiple bids and very often at over asking.”

Clean Lines, Killer Views

The British Colonial-style home at 3408 Ocean Blvd. in Corona del Mar sold on March 31 for $10.3 million, down from its February list price of $11.5 million.

The home is 4,662 square feet and sits on a 0.10-acre view lot. The master suite has a balcony that frames views of the ocean. There are three additional bedrooms and five baths, plus an office; large finished basement with a wet bar, projection TV and wine room; and a courtyard with a spa.

The transaction was represented by Ron Millar of Arbor Real Estate on the seller’s side and by Andre White of the Cain White Group, HOM Sotheby’s International Realty on the buyer’s.

Nautically Inspired

Evan Corkett and Steve High, both of Villa Real Estate, represented the seller and the buyer, respectively, in the March 31 sale of the five-bedroom, five-bath bayfront home at 70 Linda Isle in Newport Beach. It sold for $5.3 million, just under its January list price of $5.4 million.

The 4,550-square-foot home sits on a 0.138-acre lot on Linda Isle’s central lagoon. It offers cherry hardwood floors, a study with paneled bookcases, and a great room with two fireplaces, a wet bar, and an island kitchen with custom maple cabinetry.

There is also a private pier and slip that can accommodate a 74-foot boat and a side tie.

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