Aug 8, 2019

Investors are snapping up houses at a record pace

Dion Rabouin, author of Markets
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The housing market slump continues, and one little-discussed driver has been the increasing share of housing owned by investors who are looking for financial gains rather than a place to live.

The big picture: The supply of starter homes is already historically low and with prices continuing to rise and young potential buyers more indebted than ever, there's little sign that the struggles in the housing market will correct in the near-term, analysts say, even with low mortgage rates.

Details: Private equity firms, real estate speculators and other investors made up more than 11% of U.S. homebuyers in 2018, the highest percentage on record and significantly higher than the level seen before the 2008 housing crash, according to recent data from CoreLogic.

  • Not only has the investor share of homes risen to a record high, but investors are taking an even greater share — also a record high — of so-called starter homes, or the smaller, more affordable houses that typically attract lower-income and first-time buyers.

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Illustration: Sarah Grillo/Axios

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