Investors are acquiring a larger portion of U.S. homes, accounting for nearly 27% of all sales in early 2023, the highest share recorded in five years. In total, 265,000 homes were purchased by investors in the January-March quarter, reflecting a 1.2% increase from the previous year. The growth in investor purchases underscores the challenges faced by traditional homebuyers due to rising prices and high mortgage rates. Consequently, properties are taking longer to sell, increasing inventory and favoring cash buyers, which allows investors to enhance transaction volume despite a broader market slump.
In the first quarter of the year, nearly 27% of all homes sold were purchased by investors, marking the highest share in at least five years.
The share of homes bought by investors averaged 18.5% from 2020 to 2023, but has surged due to rising prices and high borrowing costs hampering traditional buyers.
As the market cools, properties are selling more slowly, leading to increased inventory which primarily benefits cash buyers and those leveraging home equity.
The U.S. housing market remains in a slump since early 2022 due to climbing mortgage rates, resulting in historically low home sales.
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