Key Takeaways
- Investors made up nearly 11% of home sellers in 2024, the highest share ever measured.
- The rising share of sales by investors comes as rental prices have fallen for 21 consecutive months and home prices have leveled off.
- The typical investor paid around $70,000 below the median home sale price as they sought rental properties in lower-priced areas.
Housing may not be the investment it was a few years ago, and that might make more inventory available for prospective buyers who have been shut out of a tight market.
Investors accounted for 10.8% of home sellers last year, the highest share ever measured by Realtor.com. At the same time, the total number of home sales fell across the board as real estate softened. With rents falling and prices leveling off, investors are increasingly looking to unload housing properties as their returns decline.
That could be good news for homebuyers who have been struggling in a market with sparse inventory that’s keeping prices elevated and activity limited.
“While investors help meet rental demand, their activity can constrain for-sale inventory by competing directly with potential homebuyers,” the report said.
Investors Are Still Buying More than Selling—But the Gap is Narrowing
Investors continued to buy more homes than they sold, a trend that has existed through more than two decades of data, the Realtor.com report said. Investors made up 13% of homebuyers in 2024, up from the prior year but slightly off their 2022 peak.
Indeed, their activity is returning closer to pre-pandemic levels. In 2024, investors bought 101,300 more homes than they sold, the smallest gap since 2020. That’s compared to the pandemic-era peak, where investors bought 260,000 more homes than they sold.
Home Values Leveling Off, Rental Prices Dropping
Investors generally buy houses for two reasons: to capitalize on rising home values by flipping them, or to make money renting them out. Housing prices surged about 30% during the pandemic real estate buying spree between 2020 and 2023, but now they’re beginning to level off.
Meanwhile, asking rents fell in April for the 21st month in a row.
The report also found that investors bought less expensive homes in 2024 in order to boost potential rental revenue. The typical investor paid $282,000 for a home purchase in 2024, more than $70,000 below the national median sale price.
“This trend highlights how investors tend to concentrate in lower-priced metros and in the lower-priced segments of the market, where homes are more likely to generate positive rental returns,” the report said. “As a result, budget-conscious buyers often find themselves in direct competition with investors for the most affordable properties, a contest many are unable to win.”