Are Investors Really Buying All the Homes?

Are Investors Really Buying All the Homes?

If you’ve been worried about competing with Wall Street for a home, here’s some good news: Institutional investors (those owning 1,000+ homes) make up a small amount of the market, and they’re pulling back, according to multiple outlets. At the peak of the pandemic housing boom in Q3 2021, institutional investors made up 2.2% of home purchases. By Q2 2024, that number had dropped to just 0.3%.

• Institutional investors currently own 0.4% of the market.

• Small investors account for around 18% of the market.

• Total investor purchases, meaning all non-primary home buyers, hit 14.8% of home sales in Q1 2024, the highest share recorded since data tracking began in 2001.

Ralph’s Take

While investors have played a notable role in the market, individual buyers continue to drive the vast majority of transactions. Additionally, there is a shift in strategy for institutional investors — rather than purchasing existing single-family homes, many are now focusing on developing build-to-rent communities.