Record buying by single-family investors in Q1, possible evidence of slowdown in Q2

on Estimated risk per 07/17/2022 09:58:00

Today in the Calculated Risk Real Estate newsletter: Record buying by single-family investors in Q1, possible evidence of slowdown in Q2

An excerpt from the letter:

Housing economist Tom Lawler discusses CoreLogic data: CoreLogic: Share of San Francisco homes bought by investors hit record high in Q1 2022; Home purchases by non-investors fell significantly year-on-year

In its quarterly report on home purchases by “investors,” CoreLogic said that the number of San Francisco homes purchased by investors, defined as organizations (private or corporate) that have kept at least three properties at a time over the past 10 years, has increased to an all-time high. level of 27.6%. in the first quarter of 2022 compared to 24.8% in the fourth quarter of 2021 and 19.2% compared to the first quarter of 2021.

active inventoryCR Notes: Investors are pulling back, which could be a factor in lower housing demand. Housing analyst Ivy Zelman said of non-essential buyers last week (slightly edited for clarity):

And we’re thinking non-core for those you know who might not appreciate what that includes: second home buyers, private investors, institutional investors, and institutional investors can also include what we call intermediaries. Liquidity providers; iBuyers. So, there has been huge speculation, and the sum of this number or the last kind of the first Q – we don’t have two Qs yet – added up to about 24% of transactions, and we think that this is even an understatement …

[We are seeing less] demand and seasonally worse than normal activity and increase [cancellations] … And I do think that the minor factor is the important factor.

There is much more in the article. You can subscribe to https://calculatedrisk.substack.com/