Cash is King: Investors Responsible for 27% of All Home Sales While Regular Buyers Get Priced Out

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News Flash

Cash Kings: Investors Snag 27% of Home Sales

Real estate investors just hit their highest purchase share in at least five years, scooping up 27% of all homes sold in Q1 2025.

That's a massive jump from the 18.5% average between 2020-2023.

The math is simple: elevated mortgage rates are sidelining traditional buyers, while cash-rich investors keep shopping. They purchased 265,000 homes during the quarter—a 1.2% increase year-over-year.

This trend is also driving up home prices in desirable areas and tightening rental inventory as investors convert purchases to rentals.

Until affordability improves for regular buyers, expect investors to keep dominating your local market.

Supply Shock: Inventory Jumps 25% Nationwide

On the flip side, active housing inventory just hit 1.1 million homes—a 25% increase from last year.

Twelve states now have more inventory than they did in 2019.

The Sun Belt is leading this surge. Arizona, Colorado, Florida, Idaho, and Texas are seeing the biggest inventory jumps as builders who ramped up construction during the pandemic boom finally deliver.

But, buyer demand has cooled significantly. Home prices that have risen "30, 50, 70, 100 percent" from pre-pandemic levels are keeping potential buyers on the sidelines.

Homes are sitting longer, and competition is easing.

Could there be better times on the horizon? Fed rate cuts expected later in 2025 could help mortgage rates fall, giving some relief to buyers. But for now, we're moving from a seller's paradise to a more balanced market. The frenzied bidding wars might be ending, but cash still talks loudest.

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