Weekly Real Estate News
Investor purchases of residential properties plummeted by 29.7% year-over-year during the third quarter, according to new data from Redfin (NASDAQ:RDFN).
Investors purchased 48,667 homes between July and September, or 15.9% of all homes sold during that period, the lowest level of any third quarter since 2016. In comparison, overall home purchases were down by 22.2% to 305,219, the lowest third-quarter level since 2012.
Investors purchased $36 billion worth of homes in the third quarter, down 19.5% from a year earlier. The typical home purchased by investors cost $475,115, up slightly from $449,895 a year earlier – but, then again, overall home prices have been on the rise year-over-year.
The seven metros where investor purchases declined fastest are all in Sun Belt markets that boomed during the pandemic: Atlanta (-49.7%), Charlotte (-49.6%), Jacksonville (-48.2%), Phoenix (-47.4%), Las Vegas (-43.3%), Orlando (-42.6%) and Tampa (-41.3%).
“We don’t expect investors to dive back into the market in a big way anytime soon,” said Redfin Senior Economist Sheharyar Bokhari. “Borrowing costs are unlikely to fall significantly in the near future, and while home prices may soften a bit, they probably won’t cool enough to bring back a critical mass of investors.”
