Homebuyers becoming major players in the housing market.

While a majority of the housing market was being swept up by investors, there is a trend showing traditional homebuyers are now reentering the market as big players.

In recent years, cash buyers and investors have taken advantage low prices and interest rates to buy distressed properties.  According to the National Association of Realtors, investors bought 1.23 million homes in 2011, up 64.5 percent over 2010.  However, that trend seems to be changing.  New data has confirmed the recent surge in home sales indicates traditional homebuyers have begun to reenter the market.  Cash home transactions, common among investors, were at 29 percent in April, down from 32 percent in March.

Traditional homebuyers are now taking advantage of the high affordability conditions.  Realtors selling distressed and non-distressed homes nationwide are seeing growing numbers of homebuyers intending to occupy the properties putting down bids.  Multiple offers are being made on properties and it is no longer solely the investors getting into bidding wars on properties.

Although economists agree that the housing market’s worst days are behind it, they say cash investors will continue to play a crucial role in nursing it back to health.  Cash buyers also carry an advantage that many middle-class homebuyers lack: They have enough money in the bank to qualify for a mortgage. According to NAR data, an individual who purchased an investment property in 2011 had a median income of $86,100, compared to the $49,445 average median household income an American family earned in 2010, the Census Bureau reported.

HomebuyersTight lending conditions still preclude many families who might have qualified for mortgages prior to the recession from buying, but that is less of an issue for investors and cash buyers.  Economists say the latest figures offer some true signs of recovery for the nations stressed housing market since its fall in 2006 due to loose lending requirements.