Real estate investors purchased 47,004 homes in the fourth quarter, according to new data from Redfin (NASDAQ: RDFN). This was a 3.9% year-over-year drop – the biggest decline in a year – and marked the lowest level for that time of year since 2016.
Real estate investors acquired 17.1% of homes that sold in the fourth quarter, the lowest level for that time of year since 2020 and down from 19% a year earlier. Investors purchased 8,220 condos in the fourth quarter, down 13% from one year earlier and the lowest level for that time of year since 2012.
But while the quantity of investor purchases was down, the amount paid for the properties was up. Investors purchased $36.5 billion worth of homes in the fourth quarter, up 6.3% year-over-year, equal to the increase in home-sale prices over that period.
The major metros where investor purchases dropped were Orlando (-27.5%), Chicago (-23.3%), Miami (-21.3%), Atlanta (-18.4%) and West Palm Beach, Florida (-14.5%). At the other end of the spectrum, investors in Seattle bought 33.8% more homes than a year earlier in the fourth quarter, a bigger increase than any other metro. Other metros that attracted investor activity were San Jose (21.1%), Oakland, California (19.4%), San Francisco (19.1%) and Detroit (15.5%).
