Investor purchases are sinking with the housing market at large

Home sales in 2024 have been well below historic norms. Higher prices, higher mortgage rates and limited inventory are making for a slow market among buyers and sellers alike.

Real estate investors tend to be more insulated from these dynamics, particularly from mortgage rates, as they are more likely to buy properties with cash. But even investors have purchased fewer homes this year.

According to data from CoreLogic, investor purchases have tracked closely with consumer home sales, and the share of home sales attributable to investors is down as well.

“Real estate is now a relatively less attractive asset to a lot of investors,” said Thomas Malone, an economist with CoreLogic. “Price growth is slowing down so there’s less flippers in the market. That’s a harder business model to maintain when prices aren’t going up quickly. Same with the iBuyers. They’ve dropped out a lot.”

This is a notable change from the years immediately after the COVID-19 pandemic, when investor purchases of single-family homes exploded along with owner-occupied purchases. Investor purchases at the national level peaked in June 2021 at 148,670.

But in September 2024 — CoreLogic’s most recent data — the number of investor purchases sat at 75,442, which is marginally higher than the post-pandemic low point but down 22.5% compared to September 2023.

Geographically, the share of homes bought by investors is down in every state in the country except in Oregon — where the share of investor purchases is up by a negligible 0.2% — and in South Dakota (3.4%), a state with a small population where a relatively few number of sales can swing the investor share.

At the metro level, Texas is seeing the most activity by investors. Between January and June of this year, Dallas (31,140) and Houston (25,820) had the most investor purchases, and San Antonio (10,163) and Austin (7,879) were both among the top 20 U.S. markets.

Among these top 20 markets, Los Angeles (41.5%); Atlanta (35.9%); Riverside, California (34%); Las Vegas (32.1%); and Seattle (30.5%) had the highest share of investor purchases. The national share in September was 25.3%.