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Investor Purchases Rose to Record High During Spring Buying Season

New-Home Sales

Investor Purchases Rose to Record High During Spring Buying Season

Investors are snapping up affordable homes at a lightning pace in small regional markets across the U.S., and local buyers are struggling to compete

July 29, 2022
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Investors purchased a record share of for-sale homes during the spring buying season, accounting for 9.5% of all homes sold during the month of April, Forbes reports. In the midst of a housing shortage keeping buyers glued to the sidelines, investors are stirring up competition and exacerbating an existing affordability crisis, particularly in the South and Midwest.

The 10 fastest-growing markets for investors offer an average home price of $372,000 compared with the U.S. median of $425,000, but that affordability is disappearing quickly. The share of homes purchased by investors is reaching historical highs as non-investor buyers pull back from home purchases, a trend likely to continue in the months ahead as housing costs soar in a cooling market. 

Investors took more inventory off the market than they added to it in April and bought homes at 10% lower median prices than they sold them. However, investors did sell more homes than during the prior year (+24%). 

Nationally, investor purchases made up 9.5% of home sales in April, just shy of the February peak (9.7%) and up 64% over 2019. Nearly three-quarters of investors paid in cash (72.2%).

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