Cash buyers are paying an average of £28,000 less for properties than those purchasing with a mortgage, data analysis has shown. Those able to buy their homes outright secured between a 9% and 13.4% discount compared to their mortgage-holding counterparts, MPowered Mortgages found. It said the accelerating property market has allowed cash buyers to argue for better deals. Since Liz Truss's disastrous mini budget in 2022, it said the 'cash discount' has shot up by 12.4%.
The discounts are considerably higher in different parts of the country. In the North West, cash buyers typically pay £31,827 less than buyers using a mortgage. In Scotland, the average cash discount is £26,476 (12.8%), and in North East England it is £22,122 (12.4%).London was found to be the only place where cash buyers do not enjoy lower prices. In September 2024, cash buyers in the capital paid £15,344 more per property than those using a mortgage - a reflection of the high numbers of foreign property investors. The discounts available to cash buyers are rising as mortgage applications surge and people with enough money to buy a property become rarer.Stuart Cheetham, chief executive of MPowered Mortgages, said cash buyers hold a 'trump card' which is speed. 'Rising demand is making a slow process take even longer, and the average seller in England and Wales now has to wait 152 days between accepting an offer and completing their sale,' he said. 'That's why buyers who have their finances fully in place when making an offer are vastly more proceedable - i.e. attractive to sellers - than those who don't. 'Sellers will often accept a lower offer in return for the extra certainty these buyers represent.