The most recent home investor report from CoreLogic revealed that the percentage of homes bought by residential investors held firm into the summer, staying essentially flat at the close of the second quarter.
Home investors accounted for 26% of all single-family home purchases in June, down just 1 percentage point from March. According to CoreLogic economist Thomas Malone, the consistency (despite the slight decline) is a signal that investor involvement in the residential market is poised to remain a significant factor in the near term.
“The year 2021 saw a surge in investor activity. Investors have since held a market share that averages 8 percentage points higher than in 2020,” Malone explained.
“Investor activity has declined slightly since early 2023, but there is still no sign that the share will fall back to its pre-pandemic level in the near future. Indeed, the most likely reason for the small drop in home investor purchases in recent months is seasonality, as owner-occupied buyers become more active in the summer.”
Home investor shares were highest in the South and Southwest regions during the second quarter. California led all states as investors accounted for 34% of all home purchases there. The District of Columbia was next at 33%, followed by Georgia (32%), New Mexico (31%), Texas (31%) and Nevada (30%).
One trend to watch is that, with the total number of investor purchases experiencing a slight ebb, smaller investors have seen their market share grow. Consider that large investors (who own between 100 to 999 properties) and “mega-investors” (who own 1,000 properties or more) have each held market shares between 8% and 10% each month in 2023.
That share isn’t out of the ordinary for large investors, but it’s a big shift for mega-investors, who held a market share of more than 10% for large parts of 2021 and 2022, before peaking at 17% in June of last year. By contrast, since seeing a recent bottom last summer, small investors (who own three to nine properties) accounted for 47% of investor purchases, their highest level since 2011.
