Investors Show No Signs of Retreating

October 25, 2013

Residential real estate is still in hot demand among institutional investors, and even growing stronger. Investors or firms that purchase 10 or more properties accounted for 14 percent of all sales on residential properties in September, up from 9 percent in August, according to a new report by RealtyTrac. September marked the highest monthly percentage of institutional investor purchases since RealtyTrac began its tracking of such transactions in January 2011.

"The housing market continues to skew in favor of investors, particularly deep-pocketed institutional investors, and other buyers paying with cash," says Daren Blomquist, vice president at RealtyTrac.

Seventy-four percent of investors paid cash for properties in September, according to the National Association of REALTORS® latest data. All-cash sales represented 33 percent of all existing-home transactions in September, up from 28 percent a year ago, NAR found. 

RealtyTrac notes that the metro areas (with populations of 1 million or more) with the highest percentage of institutional investors in September are:

  • Atlanta
  • Las Vegas
  • St. Louis
  • Jacksonville, Fla.
  • Charlotte, N.C. 

“While the institutional investors are pulling back their purchases in many of the higher-priced markets — places like San Francisco, Washington, D.C., New York, Seattle, and Sacramento — they are continuing to ramp up purchases in markets where median prices are still below $200,000 — places like Jacksonville, Atlanta, Charlotte, St. Louis and Dallas,” Blomquist says.

Source: “RealtyTrac: Investor demand boosts residential property sales,” HousingWire (Oct. 24, 2013)

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