Or are these Wall Street Investors and iBuyers in for a rude awakening as the US Housing Crash unfolds?
A new report from Redfin (https://www.redfin.com/news/investor-home-purchases-q3-2021/) suggests that nearly 20% of all homes in America where purchased by investors in third quarter of 2021. That’s up from 17% last year and more than triple the level of 6% in the early 2000s.
Increasingly real estate investors – both institutional Wall Street types as well as Mom & Pop buyers – are beginning to dominate more and more of the US Housing Market. Many people see this as a sign of the Great Reset – the notion that individual Americans will begin to own nothing while big companies will take over the US Housing Market.
But these investors, and the associated Great Real Estate Reset, is not occurring everywhere. Housing Markets such as Providence, Washington DC, and Chicago are not experiencing a high share of real estate investor demand according to Redfin.
But on the other hand, hot Sun Belt real estate markets such as Atlanta, Phoenix, and Charlotte are seeing nearly 1/3 of all homes across their respective metros sold to investors. Other cities such as Tampa, Las Vegas, and Miami are also near the top of the list.
What’s alarming is that approximately 76% of these investor purchases are made in cash. Meaning that if you’re a first-time home buyer hoping to buy with a traditional mortgage in an affordable location of Phoenix or Atlanta – good luck! Investors could be buying as many as 50% of the homes in these types of neighborhoods.
But what’s interesting is how similar this 2021 investor demand surge looks compared to the previous bubble in the mid-2000s. It was the same Housing Markets back then (Phoenix, Atlanta, Miami) that investors swarmed into. And those areas ended up experiencing around 50% declines in home prices.
Rather than a Great Reset – could we be seeing a repeat of 15-years ago? When many real estate investors piled into the Sun Belt, pushing home values up, only to exit the market in a flash when prices decline?
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0:00 The Great Reset is HERE!
1:29 Record Investor Purchases in Q3 2021
2:40 75% Increase in only 18 Months!
3:40 Not a Nationwide Phenomenon!
4:41 Investors not Interested in Midwest / Northeast
5:46 Wall Street Controls these 10 Cities
6:44 SHOCKING FIGURES! Up to 50% of Affordable Homes?
7:45 Increasing Investor Share Scatter Plot
8:39 Great Reset is LOCAL! In the Sun Belt
9:35 But Wait…Silver Lining!
10:19 Investor Demand is Fickle! Same cities as Last Time
11:09 Repeat of mid-2000s Bubble
#GreatReset #HousingMarket #HousingCrisis