U.S. investors purchased roughly 52,000 homes in the quarter, the lowest number since 2020, Redfin said in its quarterly report of county-level housing sales data from 39 of the country’s largest metropolitan regions. The pullback is due largely to high home prices and elevated interest rates that make it more expensive for investors to fund loans for mortgages or renovations.
Redfin senior economist Sheharyar Bokhari said the math just doesn’t work out the way it did several years ago regardless of whether investor intent is to quickly flip the home for profit or build a portfolio of rental properties—and tightening regulations on short-term rentals in many areas has led to further cooling in investment sales.
“It costs a lot to buy a home, and potential returns are simultaneously softening,” Bokhari said.
“That doesn’t mean investors are disappearing—they’re still buying nearly one in five homes in the country—but they’re being choosier about their home purchases, just like individual homebuyers.”
The softening in residential investor purchases was most keenly felt among condominium properties, Redfin said. Although investors snapped up about 9,500 condo properties in the second quarter, it was the slowest pace since 2013 (excluding the onset of the COVID-19 pandemic in 2020) and a 13 percent decline from the same quarter in 2024. Multifamily purchases fell just 2 percent, while single-family homes and townhomes dipped 4 percent.
Condominium purchases flattened, Redfin said, because it’s an asset class that often includes high HOA, or homeowner association, fees and maintenance assessments that can further erode profitability and increase investor risk. Many metropolitan regions also saw weakening rents, increased vacancies and decreasing values in the condo sector, Redfin noted.
John Tomlinson, a Redfin agent in Fort Lauderdale, Florida, said the condo market is the slowest he’s seen in the past decade.
“Buyers are wary of putting offers on condos, and many are canceling contracts after they’ve made offers, because costs have increased so much and they’re nervous that they’ll continue rising in the future,” Tomlinson said.
“A lot of insurance companies won’t cover condo buildings on the coast, and some mortgage lenders are quoting higher rates for condos. If you’re an investor, you can’t count on making money from a condo right now.”
Investors have become increasingly shy of the housing market in Florida, Redfin notes. Insurance and HOA costs have surged in the Sunshine State amid a spate of natural disasters and the 2021 collapse of Champlain Towers South in Surfside that killed 98 and led to the passage of Senate Bill 4-D. The bill mandates a host of safety and structural integrity assessments for condominium properties over three stories tall.
As a result, investor appetite was tepid for residential properties in key Florida markets—year-over-year purchases tumbled 25 percent in Orlando and 21 percent in Fort Lauderdale. Jacksonville was down 16 percent, West Palm Beach dipped 13 percent, and Miami investment purchases fell 12 percent in the second quarter, Redfin reported.
On the other hand, investor purchases skyrocketed in Seattle, which jumped 51 percent, followed by San Francisco, at 24 percent, and Portland, at 14 percent.
