|
Thomas Malone of CoreLogic reports on investor activity, noting that as home flippers and larger investors take a backseat, smaller investors show resilience. In July, August, and September, investors purchased 26.8%, 27.2%, and 28%, respectively, of the share of single-family homes. Given this, CoreLogic expects to see these numbers climb above 30% in the near future. |
 |
|
Source: CoreLogic (December 2023)
“Smaller investors continue to make up most of that buyer segment. Figure 3 shows that throughout 2023, mega-investors (those that own 1,000 or more properties) and large investors (those that own of 100 to 999 properties) each held market shares of about 10% in the third quarter. The medium investor share (those that own 10 to 99 properties) slid slightly from 36% to 35%, and small investor activity (those that own three to nine properties) held steady at around 45%.” ATTOM Data Solutions reports on flipping activity, which although it is seeing profits rise, is declining overall in activity. In Q3 2023, flippers represented 7.2% of total home sales, down from 7.9% in Q2, and is now the lowest point in two years. Akron, OH had the highest portion of profits for any metro nationwide. |
 |
|
Source: ATTOM Data Solutions (December 2023)
“But even as flipping rates declined, the latest analysis also revealed that fortunes continued improving for home flippers during the third quarter in the form of rising profits. Investor returns increased for the third quarter in a row, rebounding from a slump that had slashed profit margins by nearly two-thirds from early-2021 to late-2022. Margins, along with raw profits, rose to the highest levels since the middle of last year.” In good news for new investors, Fannie Mae reportedly cut downpayment requirements for smaller owner-occupied multifamily properties. Now, instead of paying 15-25% down, Fannie Mae will only require 5% if the investor is going to occupy one of the units in the apartment. This new rule change applies to smaller multifamily units of 4 units or less. |