The U.S. real estate market is about to see a shift in the coming months, according to an industry expert.
Small real estate investors increased their foothold in the market last year, according to a new report from Realtor.com.
Realtor.com found small investors made 59% of all investor home purchases last year. That figure, the real estate marketplace said, represented the “highest share in the data’s history” for entities that have bought ten or fewer homes.
The number of homes acquired by small investors rose 3.7% year-over-year to hit 361,900 in 2024, according to the report.
‘SOLD With Multiple Offers’ real estate sign near purchased house indicates hot seller’s market in a desired neighborhood. (iStock / iStock)
Meanwhile, the share of investor home acquisitions by large investors reached the “lowest” level in 17 years, Realtor.com said.
Entities that have bought at least 50 homes were responsible for 21.7% of all investor purchases last year, per the report.
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They bought 132,500 homes in 2024.
On the whole, real estate investors made up 13% of home purchases last year, roughly 0.3 percentage points higher than 2023, according to Realtor.com.
The real estate marketplace attributed that to a “decrease in total home sales” and said it signaled a “growing presence of investors in a smaller market.”
Real estate investor purchases hit a high of 13.3% of homes in 2022, per the report.
Sold Home For Sale Sign and New House (iStock / iStock)
The report also found investors resorted to debt more frequently to fund their real estate moves last year, with those using cash to buy properties dipping to 62.3%.
States such as Missouri, Oklahoma and Kansas made up some of the largest percentages for home purchases by investors in 2024, Realtor.com reported.
Real estate investors sold 10.8% of homes that transacted across the United States in 2024, marking the “highest share on record” of the more than two decades Realtor.com has tracked it.
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Daniellie Hale, chief economist at Realtor.com, said in a statement that the investor trends “signal a transition.”
“Nationwide, investors picked up more homes on net in 2024, as smaller investors were a growing majority of investor buyers,” she said. “But with investor selling at a new high, the market saw the smallest net investor buying activity in five years, lessening one of the notable headwinds for entry-level buyers who often compete with investors.”
This comes as the housing market “continues to adjust from the pandemic-era frenzy, with inventory levels improving, home price growth leveling off and rents easing,” the real estate marketplace said.
Row of identical houses and yards, Queens, New York (Lindsey Nicholson/UCG/Universal Images Group via Getty Images / Getty Images)
In May, the U.S. was home to over 1 million active listings, up 8% from the prior month and 31.5% from a year ago, Realtor.com reported earlier in the month.
The median asking price for homes was $440,000 in May.
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