How Many Homes Are Investors Actually Buying?

by Santiago Valle

If you’re searching for a house to buy, you might be wondering how much of the market investors are snapping up. Social media and various reports often claim that investors are buying all the homes, making it more challenging for the average buyer to find a suitable property. However, there's a lot of misinformation out there. Let's clear up the confusion and get to the heart of what's happening.

Investor Activity: The Pandemic Boom and Beyond

According to The Wall Street Journal (WSJ), investors of all sizes spent billions of dollars buying homes during the pandemic. At the height of this buying frenzy in 2022, investors purchased more than one in every four single-family homes. But here's the catch: their activity has since slowed significantly due to rising interest rates and tighter housing supply.

Who Are These Investors?

During the peak period, while investors were active, three out of every four single-family homes were still bought by regular, everyday buyers—not investors. Moreover, most of these investors weren't the big corporate entities that often made headlines. Instead, they were small, mom-and-pop investors—people like your neighbours who might own just a few properties, such as their primary home and perhaps a vacation house.

The Myth of the Mega-Investor

Let's address the elephant in the room: the mega-investor. These firms own 1,000 or more properties and often get blamed for making it difficult for regular folks to buy homes. According to the WSJ, these mega-investors have yet to buy many available homes. They accounted for about 2% of single-family home purchases at their peak. This percentage has since dropped so low that it rounds to nearly 0%.

Why Investor Activity Is Slowing Down

Understanding the reasons behind the slowdown in investor activity is crucial. Jeffrey Tesch, CEO of private lender RCN Capital, highlights several challenges investors face today: rising home prices, limited inventory, and higher financing costs. These factors make it difficult even for big investors to continue buying homes at the same rate.

Impact on Homebuyers in San Antonio

This slowdown in investor activity is good news for those looking for houses for sale in San Antonio. It means less competition from investors, making it easier for regular buyers to find a house for sale in San Antonio. Even during the peak of investor buying, most homes were still purchased by regular buyers.

Local Real Estate Insights

If you're concerned about the housing market and its impact on investors, your best bet is to consult a local real estate agent. They deeply understand the demand for houses in San Antonio and can provide valuable insights and guidance to help you navigate your home-buying journey.

Tips for Competing in a Competitive Market

To improve your chances of finding a house for sale in San Antonio, consider these tips:

Work with a knowledgeable real estate agent: Their expertise can give you an edge.
Getting pre-approved for a mortgage shows sellers you're a serious buyer.
Be ready to act fast: The market moves quickly, and being prepared can make all the difference.

Debunking Common Myths

Debugging the myths surrounding investor activity in the housing market is essential. Mega-investors do not dominate the market as much as sensational headlines suggest. Facing the same challenges as everyone else, small investors make up the bulk of investor activity.

Future Trends in Investor Activity

Looking ahead, investor activity is expected to remain subdued due to the ongoing challenges in the housing market. This trend provides a more favorable environment for regular buyers looking for houses in San Antonio.

Conclusion

In summary, while investor activity was significant during the pandemic, it has declined, making more room for regular buyers. Don't be swayed by myths and misinformation. The housing market, especially for houses for sale in San Antonio, remains accessible to everyday buyers. Contact a local real estate agent to get the most accurate and up-to-date information if you have concerns or questions.