If you’re thinking about buying a house, you might be interested in the latest news about real estate. This helps you understand what’s going on and how it could affect your decision. Lately, you might have heard about investors and wondered how they’re influencing the housing market. This might make you wonder things like:
- How many houses do investors own?
- Are big Wall Street companies really buying so many homes that regular people can’t find one?
- Now, let’s get into the specifics and look at the real numbers from the data.
- Firstly, we want to figure out how many single-family homes (SFHs) there are and what part of them are rentals owned by investors. According to SFR Investor, which examines the single-family rental market in the United States, there are eighty-two million single-family homes in the country. Now, let’s break down how many of these are actually rentals.
- As per recent data, sixty-eight million (82.93%) of these homes are owner-occupied, meaning the person who owns the home also lives in it. If we subtract this number from the total single-family homes (82 million), we are left with approximately fourteen million homes that are single-family rentals (SFRs).
No, institutional investors do not own all of those remaining fourteen million homes. Let’s break it down further by looking at four categories of investors:
- Mom & Pop Investor: Owns between 1-9 Single-Family Rentals (SFRs)
- Regional Investor: Owns between 10-99 SFRs
- Smaller National Investor: Owns between 100-999 SFRs
- Institutional Investor: Owns over 1,000 SFRs
These categories reveal that not all investors are large institutions. To make it clearer, here are the percentages of rental homes owned by each type of investor (refer to the chart below):
The chart clearly illustrates that, contrary to what the news and social media might suggest, the green section indicates that the vast majority of homes are not owned by large institutional investors. Instead, most homes are owned by small mom & pop investors, similar to your friends and neighbors.
What’s really going on is that there are people, much like yourself, who value homeownership. They see buying a home, whether it’s a primary residence or a second one, as an investment. Some may have seized the opportunity to acquire a second home in recent years for rental income, while others chose to retain their first house instead of selling it when they moved up.
So, it’s important not to believe everything you read or hear about institutional investors dominating the housing market. They aren’t buying up all the homes, and they aren’t making it impossible for the average person to buy. The numbers show that institutional investors actually represent the smallest portion of the pie chart.
Bottom Line
Indeed, institutional investors play a role in the single-family rental market, but it’s important to note that they aren’t acquiring all the houses available. If you have additional questions or concerns about information circulating in the housing market, feel free to reach out. I’m here to provide expert insights and context to help you better understand the situation.
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Tue, 05 Dec 2023 20:12:40 +0000
by Mottek Group