The investor share of home sales reached an all-time-high in 2024 as declining rents and slower home price growth has prompted some investor-owners to cut their losses.
The article from Investopedia discusses a noticeable trend in the U.S. housing market where investors are increasingly selling their properties due to declining rental income. Data from Redfin indicates that investors sold 38.5% more homes in the second quarter of 2023 compared to the previous year, driven by a drop in rents and the high cost of borrowing. This shift is particularly evident in markets like Las Vegas, Phoenix, and Atlanta, where investor purchases have significantly decreased. The decline in rental prices, influenced by an increase in available rental units and economic uncertainty, has made it less profitable for investors to hold onto their properties. Additionally, the article highlights that the rise in interest rates has made financing more expensive, further pressuring investors to sell. This trend could potentially lead to more affordable housing options for buyers as the supply of homes increases.