Sales of homes to investors and corporations, often in cash, are pricing out would-be homebuyers.
“In 2021 — as home prices, then rents, soared — so did investor activity in Harris County, according to a data analysis by the National Association of Realtors. About 40 percent of existing homes sold last year went to investors, one of the highest percentages in the country,” reports R.A. Schuetz in the Houston Chronicle. “Texas — which has seen strong population growth from residents fleeing higher-cost markets — led the country for the highest share of homes purchased by corporations and companies.”
Purchases of single-family homes by investors—defined in the analysis as “any corporation, company or limited liability company — categories that include both hedge funds and mom-and-pop landlords, flippers and a number of real estate startups” are often done in cash, making it increasingly difficult for potential homebuyers and renters to compete. “Even with number of existing homes being converted to rentals — a survey of members of the National Association of Realtors estimated 42 percent of company-bought homes are turned to rentals — a family looking to rent a single-family home will find options scarce.” As for the rest, “Most of the investor-bought homes that are not turned to rentals eventually are sold to homebuyers, though likely at higher prices to compensate for improvements, holding expenses and market changes.”
FULL STORY: Investors purchased 40 percent of Harris County homes sold in 2021, says National Association of Realtors
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