Investors Dominate US Housing Market Amid Price Surge
Real estate investors are increasingly purchasing a larger share of US homes due to rising prices and borrowing costs. In Q1 2023, investors accounted for nearly 27% of home purchases, reflecting a slowdown in the market's traditional buyers. This trend benefits cash-rich investors amidst affordability challenges.
- Country:
- United States
Real estate investors have taken on a dominant role in the US housing market as escalating prices and persistent borrowing costs discourage many potential homebuyers. A recent report from real estate data provider BatchData reveals that investors purchased nearly 27% of homes sold in the first quarter of the year, marking the highest share in over five years.
The share of homes bought by investors has climbed from an average of 18.5% during 2020-2023, totaling 265,000 homes for this year's January-March period. Although this marks a modest annual increase of 1.2%, it underscores how the housing market has slowed, with traditional buyers increasingly constrained by affordability issues.
Since early 2022, the US housing market has struggled with a downturn as mortgage rates rebound from pandemic lows. Elevated prices and mortgage rates continue to discourage potential buyers, creating opportunities for cash-rich investors who perform transactions without the burden of today's high lending costs.
(With inputs from agencies.)
Google News