Residential Real Estate Investor Cash Purchases plummeted to a mere 64% in Q1 of 2024, a stark contrast to the cash-flashing frenzy of late 2021 when 69.7% of investors whipped out the Benjamins to dominate bidding wars.
This marks the lowest cash-cow investor share since the dark ages of 2008. Despite rising interest rates, the shift toward financing among investors is largely driven by the increasing dominance of small-scale investors. Small investors – those with 10 or fewer home purchases since 2001 – accounted for 62.6% of investor purchases in the first quarter, according to Realtor.com. This marks the highest proportion of small investors in the dataset’s history, indicating a significant change in the housing market investor investor.
G. Brian Davis, a real estate investor and co-founder of property management software SparkRental, believes the rise of individual real estate investors is a positive development.
Rejoice, humble homebuyer! The all-cash tsunami has subsided, and the tides of fairness may be turning in your favor. With fewer deep-pocketed investors tossing around greenbacks like confetti, the bidding wars might finally be drawing to a close.