Are Investors Actually Buying Up All the Homes?

If you’re in the market to buy a home, you might feel like you’re constantly competing against big-money investors scooping up every available property. There’s a widespread belief that Wall Street investors are driving up prices and making it tough for everyday buyers to get a fair shot. But is that really the case? Let’s take a closer look at the data and clear up some misconceptions.

Most Investors Are Everyday People, Not Mega Corporations

Many assume that giant institutional investors dominate the housing market, but the reality is quite different. According to The Mortgage Reports, small investors—individuals who own just a few rental properties—make up around 18% of the market, while massive institutional investors represent only about 1% of total home purchases.

That means the majority of real estate investors are actually regular people—your neighbors, local landlords, or individuals who’ve bought an additional home for rental income. The idea that large corporations are taking over entire neighborhoods simply doesn’t hold up when we look at the numbers.

Investor Purchases Are on the Decline

While it’s true that institutional investors made some waves in recent years, their buying activity has significantly slowed. At their peak in Q2 2022, institutional investors (those owning 1,000+ single-family homes) accounted for just 2.4% of home sales. Fast forward to Q3 2024, and that number has plummeted to only 0.3%, according to John Burns Research and Consulting (JBREC).

So why the pullback? Rising mortgage rates and home prices have made real estate investing less appealing, causing many big players to scale back their purchases. This means there’s actually less competition from large investors than in previous years.

What This Means for You as a Buyer

If you’ve been worried that Wall Street investors are pricing you out of the market, the data suggests otherwise. While some investors are still active, their presence is far smaller than many believe. In fact, with fewer institutional investors buying, now could be a great opportunity to find the right home without as much competition.

Bottom Line

The idea that big investors are buying up all the homes and making it impossible for everyday buyers to compete is largely a myth. If you’re ready to explore your options, let’s connect and discuss what’s happening in our local market. You might be surprised at the opportunities available to you!