Investors' home buying down 30%, largest since 2007 Recession

There is a 30.2% decline in investor home purchases this third quarter. This is much more than the 27.4% drop in overall home purchases nationwide.

This is the largest decline in investor home purchases since the Great Recession of 2007, ignoring the second quarter of 2020, mainly affected by COVID-19.

Why are real estate investors hitting brakes on home purchases?
Phoenix, Arizona, Portland, Oregon, Sacramento, California, Atlanta, and Georgia are facing the biggest decline in real estate investor activity.

Economists view the decrease in home buying and increase in mortgage rates as the reason. Mortgage rates usually do not affect investor home buyers since they are cash-rich, but weakening home prices do. 

“It’s unlikely that investors will return to the market in a big way anytime soon. Home prices would need to fall significantly for that to happen,” says Sheharyar Bokhari, senior economist at Redfin. 

On the other side
Bokhari also adds, “This means that regular buyers who are still in the market are no longer facing fierce competition from hordes of cash-rich investors like they were last year.”