Tags: investors | home | purchases | housing

Mom-and-Pop Landlords Push Investor Share of Home Purchases to 20-Year High

Mom-and-Pop Landlords Push Investor Share of Home Purchases to 20-Year High
(Karenr/Dreamstime)

Thursday, 20 June 2019 02:16 PM

Investors last year made up the biggest chunk of home sales in the U.S. in two decades, adding to competition in the already tight starter-home market.

The share of homes bought by investors reached 11.3%, the highest level in data dating back to 1999, according to a report by CoreLogic Inc. That’s slightly higher than the 11% in 2017. The investor share of the starter-home market peaked over the past two years at one in five sales.

Rising home prices, bolstered by a strong economy and a shortage of listings, pulled in fix-and-flip buyers inspired by HGTV reality shows, and landlords jumped in to take advantage of strong rental growth.

The growth in home purchases recently has been primarily among smaller investors, not large institutional players like Blackstone Group LP, which were most active after last decade’s housing crash, CoreLogic said.

“So-called ‘mom-and-pop’ investors grew from 48% of all investor-purchased homes in 2013 to more than 60% in 2018,” CoreLogic said in the report. “Large investors – those who purchased more than 101 homes – nearly doubled their activity between 2000 and 2013 but have pulled back since the foreclosure crisis and now sit at 15.8% of purchases.”

Investors are now primarily focused in areas where costs are cheap and rental returns are relatively favorable.

The markets with the highest investor activity are Detroit, where they made up 27% of sales, followed by Philadelphia, Memphis, Tennessee, Long Island, New York and Oklahoma City.

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Investors last year made up the biggest chunk of home sales in the U.S. in two decades, adding to competition in the already tight starter-home market.
investors, home, purchases, housing
243
2019-16-20
Thursday, 20 June 2019 02:16 PM
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