How Many Homes Are Investors Actually Buying?

Are large investors really dominating the home-buying market today?

If you're in the market for a new home in Colorado Springs, you might be wondering about this, especially if you've come across social media reels or articles suggesting that investors are scooping up all the available properties, making it tougher for the average buyer. Let me set the record straight: there’s a lot of misinformation out there.

Here’s what’s really happening: Much of the significant investor activity is now behind us.

According to The Wall Street Journal:

"Investors of all sizes spent billions during the pandemic to snap up properties. At the peak in 2022, they accounted for over one in every four single-family homes sold. However, as interest rates have risen and supply has tightened, their activity has notably decreased."

It's crucial to note that even at the height of investor purchases, three out of every four single-family homes were bought by regular homebuyers—not investors. Moreover, among these investors, most weren't the large entities you might expect. The majority were smaller, mom-and-pop investors, perhaps akin to your neighbors, who might own just a couple of properties, including their primary and a vacation home.

However, since the focus is often on large, mega-investor firms on social media—those owning over 1,000 properties—it’s surprising to note, as per The Wall Street Journal, that these firms have not been buying many homes at all. The graph (above) would illustrate that at their peak in 2022, these investors bought about 2% of the available single-family homes, a figure that has since declined to nearly negligible levels.

To understand why this percentage is decreasing, Jeffrey Tesch, CEO of RCN Capital, shares that:

"Investors are contending with numerous challenges in today’s market—escalating prices, a scarcity of listings, and rising financing costs."

These insights are vital as they debunk the myth that large, mega investors are overwhelming the housing market.

Bottom Line

Large investors are not taking over the entire housing market. If you're hearing rumors and want clarity on the real estate dynamics, especially about buying or selling a home in Colorado, let's connect. I can help you understand what’s truly happening and how it impacts your real estate goals. 719-232-1564

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Posted by: Mariana Wagner
The Colorado Home Team
Realtor® | Marketing Manager

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