What do Nevada, Florida, Vermont, and New York have in common? It's the fact that more than half of house sales in these states involved all-cash transactions. According to a report by RealtyTrac, 58%, 57/%, 80%, and 51% of sales in Nevada, Florida, Vermont, and New York were paid in cold cash, respectively.

However, the biggest metropolitan which was a hotspot for investors currently was Atlanta. Forty-two percent of sales in the city were all-cash deals, with 27% of buyers being investors. As Atlanta currently has a foreclosure rate that was one of the highest in the country, it was a prime target for investors.

Yes, these markets spelled out foreclosures and depressed home prices. Investors including private equity firms went on ahead to buy homes at these hotspots before prices started to go up again.

Despite this, RealtyTrac Vice President Daren Blomquist said, "The U.S. housing market is slowly but surely moving toward a more normalized and sustainable pattern after a flurry of institutional and cash buyers flocked to residential real estate last year, pushing up prices and picking clean the best inventory available in many areas."