HUD Articles
Impact of Institutional Buyers in Residential Sales
July 07, 2022
A new analysis of institutional home buyers and their impact on single-family properties conducted by the National Association of Realtors Research Group found that this segment of buyers comprised 13% of the residential sales market in 2021, with the median purchase price of institutional buyers on average 26% lower than the states’ median purchase prices.
With the inventory of existing-homes available in March 2022 equivalent to just two months of supply, well below the desired level of six months, the home sales and rental markets continue to suffer from a huge undersupply of both for-sale and for-own units.
NAR defined institutional buyers as “companies, corporations, or limited liability companies (LLCs),” and researched deed records data to conclude that institutional buyers purchased 13.2% of the nation’s residential properties in 2021, up from 11.8% in 2020. It was found that institutional investors made up a greater share of the market in counties where the number of homes available for sale was tighter.
