Real estate investors are making moves once again, buying up a record 18.4 percent of the homes that were sold in the U.S. last quarter. According to Redfin, that’s up from 17.4 percent in the third quarter and way up from 12.6 percent a year earlier.
The number of homes bought by investors jumped throughout 2021, as did the number of all-cash sales. Redfin notes that 75.3 percent of investor home purchases were paid for with all cash in the fourth quarter.
Additionally, single-family homes made up about 74.8 percent of investor purchases in Q4, close to the record set in Q3 where 75 percent of investor purchases were single-family homes.
“While record-high home prices are problematic for individual homebuyers, they’re one reason why investor demand is stronger than ever,” said Redfin economist Sheharyar Bokhari. “Investors are chasing rising prices because rental payments are also skyrocketing, incentivizing investors who plan to rent out the homes they buy. The supply shortage is also an advantage for landlords, as many people who can’t find a home to buy are forced to rent instead. Plus, investors who ‘flip’ homes see potential to turn a big profit as home prices soar.”
A number of Southern California hotspots saw investment purchases accounting for a significant amount of fourth quarter sales. San Diego saw a 20.3 percent investor share in Q4, followed closely by Anaheim at 19.8 percent. Los Angeles and Riverside were close behind with 18.8 percent and 15.6 percent investor sales, respectively.
L.A.’s total value of investor purchases reached $6,747,398,287, while Anaheim’s investor share hit $2,683,359,000. San Diego followed at $2,352,469,559, while Riverside saw a investor share of $1,694,137,168.