Introduction: The Elephant in the Room

If you've been anywhere near the New Hampshire real estate market lately, you've probably noticed something strange—cash offers are popping up like dandelions in spring. But where’s all this money coming from? It seems like every other day, another property is snatched up with a fat stack of cash, leaving traditional buyers scratching their heads. As someone who’s been deeply embedded in the Lakes Region market, this sudden influx of cash has me—and a lot of others—wondering: What’s going on? Let’s dive into the nitty-gritty and figure out what’s driving this trend.

The Migration: Fleeing the City Life

Let’s start with one of the biggest drivers of cash in the market—urban migration. The pandemic has changed the way we live, work, and play. With remote work becoming the new norm, people no longer need to live close to their jobs. This freedom has unleashed a wave of city dwellers looking for more space, fresher air, and a slower pace of life. And where better to find that than in the serene landscapes of New Hampshire?

These buyers, often from bustling cities like Boston and New York, are selling their properties at sky-high prices and then turning around to purchase homes in New Hampshire. They’re coming armed with big bucks, ready to outbid anyone in their way. Cash offers become their weapon of choice—fast, clean, and irresistible to sellers.

The Investors: REITs and Beyond

But it’s not just individual buyers fueling the fire. There’s another player in town, and they’ve got even deeper pockets—Real Estate Investment Trusts (REITs) and other institutional investors. These entities aren’t just buying a home here and there; they’re scooping up entire neighborhoods, flipping them, and renting them out for profit. They’re in it for the long haul, and they’re not afraid to throw cash around to get what they want.

Why are REITs so interested in New Hampshire? Simple—return on investment. With property values soaring and rental demand high, it’s a goldmine for them. They’re buying low, renovating (sometimes), and then renting or selling high. It’s a win-win for them but a tough break for the average homebuyer.

The Out-of-State Buyers: Making a Move

Out-of-state buyers are another significant source of cash. These folks are looking to escape high-tax states, or they’re retirees seeking the peace and tranquility of New Hampshire’s lakes and mountains. They’re selling their homes in states like California, New York, and Massachusetts, where property prices are through the roof, and then buying in New Hampshire, where they get more bang for their buck.

And they’re not just buying vacation homes anymore. Many are relocating permanently, bringing with them the proceeds from the sale of their previous homes. They come to the table with cash, making it difficult for local buyers to compete. When you’ve got someone willing to drop $500,000 in cash on a property that’s listed at $400,000, it’s hard to keep up.

Foreign Investment: A Global Market

Let’s not forget about foreign investors. Yes, New Hampshire has caught the eye of international buyers, particularly those from Europe and Asia. They see the United States as a safe place to invest, and New Hampshire, with its natural beauty and stable economy, is an attractive option.

These investors often purchase properties as part of a diversified portfolio. They’re looking for assets that will appreciate over time, and real estate in a desirable location like New Hampshire fits the bill. They come armed with cash, ready to make an offer that’s hard to refuse. It’s a global market, and New Hampshire is very much a part of it.

Tapping into Retirement Savings: Cashing Out

Another factor contributing to the rise of cash buyers is retirees tapping into their savings. With the stock market doing well (most of the time) and home values increasing, many retirees are cashing in on their investments and buying homes outright. They’re looking for a place to settle down, often choosing New Hampshire for its quality of life and lower cost of living compared to other states.

These buyers are savvy—they’ve worked hard, saved up, and now they’re ready to enjoy the fruits of their labor. They know that by paying cash, they can often get a better deal, close faster, and avoid the headaches that come with financing. It’s a smart move, and it’s contributing to the overall cash flow in the market.

The Appeal of the Lakes Region: A Buyer’s Paradise

The Lakes Region, in particular, is a hotbed for cash buyers. The area’s natural beauty, coupled with its proximity to Boston, makes it an ideal location for those looking to escape the city without completely disconnecting. Buyers are drawn to the region’s lakes, mountains, and small-town charm, making it a prime spot for vacation homes and permanent residences alike.

But here’s the kicker—these properties aren’t staying on the market for long. When a beautiful lakeside property goes up for sale, it’s often gone within days, and more often than not, it’s sold for cash. Sellers are eager to close quickly, and cash buyers are happy to oblige. It’s a match made in real estate heaven, but it’s leaving a lot of traditional buyers in the dust.

The Impact on Local Buyers: A Tough Market

So, what does all this mean for local buyers? Well, it’s not great news. Competing with cash buyers is tough, especially when they’re willing to pay above asking price. Traditional buyers who need to secure financing often find themselves at a disadvantage. They’re up against offers that are quicker, cleaner, and often higher.

It’s frustrating for many—particularly first-time homebuyers or those relying on VA or FHA loans. They’re ready to make a move, but they’re getting outbid left and right. It’s a tough pill to swallow, especially when you’re trying to buy a home in the community you grew up in. The market is competitive, and it’s forcing some buyers to either stretch their budgets or look elsewhere.

And then there’s the issue of personal letters. The National Association of Realtors (NAR) may frown upon them, but who are they to talk? NAR hasn’t exactly been a hotbed of ethical conduct recently. It’s a bit ironic when you consider the controversies and class-action lawsuits they've been involved in. So, if you decide to go against your Realtor's advice in the interest of getting the best outcome, it’s a choice that’s not without reason.

Sellers’ Market: Who Benefits?

On the flip side, if you’re selling a home in New Hampshire right now, you’re in luck. It’s a seller’s market, and cash offers are flying in. Sellers are in the driver’s seat, with the ability to choose the best offer—often the one that closes the fastest and has the fewest contingencies. Cash offers are hard to resist, and they’re giving sellers a significant advantage.

But there’s a flip side to that coin. While sellers are benefiting from the influx of cash buyers, the long-term impact on the community could be less rosy. As more properties are sold to out-of-state and foreign buyers, there’s a risk that the local character of communities could change. Long-time residents might find themselves priced out, and the sense of community could diminish as neighborhoods become dominated by vacation homes and rental properties.

Navigating the Market: Tips for Traditional Buyers

If you’re a traditional buyer in this market, don’t lose hope—there are still ways to compete. Here are a few tips to help you navigate the cash-heavy waters:

1. Get Pre-Approved: Before you start house hunting, make sure you’re pre-approved for a mortgage. This shows sellers that you’re serious and ready to go.

2. Be Ready to Move Quickly: In this market, hesitation can cost you. If you find a home you love, be prepared to make an offer quickly.

3. Consider a Larger Down Payment: If you can swing it, offering a larger down payment can make your offer more attractive to sellers.

4. Write a Personal Letter: Sometimes, a heartfelt letter to the seller can make a difference. Let them know why you love their home and why you’re the right buyer. (See comment above.) 

5. Work with a Local Area Specialist: A certified PSA (Pricing Strategy Advisor,) who knows the market inside and out. They can help you navigate the process and give you an edge in a competitive market. 

Conclusion: The Future of New Hampshire Real Estate

The real estate market in New Hampshire, particularly in the Lakes Region, is on fire—and cash is fueling the flames. From urban escapees to institutional investors, retirees, and foreign buyers, everyone wants a piece of the Granite State. While this influx of cash offers benefits to sellers, it’s making life difficult for traditional buyers who are struggling to compete.

As we move forward, it’s essential to monitor the long-term impacts of this trend. Will the character of New Hampshire’s communities change as more properties are sold to out-of-state and foreign buyers? Will local buyers continue to be priced out of the market? Only time will tell. Make sure to register on Search603Homes.com  to receive your free Neighborhood Monthly Market Report.

But one thing’s for sure—New Hampshire is no longer the best-kept secret in real estate. The cat’s out of the bag, and the cash is flowing. If you’re in the market, buckle up—it’s going to be a wild ride.