U.S. Real Estate Investor Trends: A Closer Look at the Market for Condos

Overview of Investor Purchases

In the first quarter of 2025, U.S. real estate investors purchased 46,726 homes, marking a modest 2% increase compared to the previous year. According to a report from Redfin, this increase illustrates a return to stability after the erratic swings of the pandemic, where investor purchases fluctuated dramatically, peaking at 145% growth in mid-2021 before dropping by nearly 47% at the start of 2023.

Key Statistics:

• Total investor purchases: 46,726 homes
• Year-over-year growth: 2%
• Market stabilization: Fluctuation maintained within 4% quarterly.

Investor Behavior and Trends

Post-pandemic, investor purchases have normalized, aligning closely with broader homeowner trends. Sheharyar Bokhari, a Senior Economist at Redfin, noted that "investor home purchases have leveled off because rapid sale-price and rent growth is no longer the norm." This shift allows traditional homebuyers greater access to the market since there’s reduced competition from investors, enabling potential negotiations on pricing.

Financial Insights:

• Median capital gains for investor-sold homes in March: $182,980 (an increase of 2.8% year over year).
• Percentage of homes sold at a loss: 6%, a slight rise from last year’s 5%.

Decline in Condo Purchases

While overall investor activity holds steady, there has been a 3% decline in the purchasing of condos, bringing the total to 8,509 complexes acquired in the first quarter— the lowest level recorded since the onset of the pandemic.

Contributing Factors:

• The condo market is decelerating faster than the broader housing sector.
• Concerns about decreasing value lead to cautious investor sentiments. For instance:
  • 68% of condos sold recently went for less than list price, the worst performance in five years.

State-Specific Concerns: Florida’s Impact

In Florida, rising HOA fees and insurance costs, exacerbated by frequent climate-related disasters, have significantly contributed to the nationwide decline in condo purchases.

Local Insights from Stuart Naranch, a Redfin agent in Washington, D.C.:

• "It’s a tough time to rent out a condo." High mortgage rates and potential rental regulations deter investors.

Current Market Conditions:

• Condo owners are increasingly looking to offload properties as investment profitability declines.
• Buyers looking for primary residences might find favorable conditions due to the surplus of available units.

Notable Changes in Investor Activity in Florida

Florida has exhibited the most significant declines in investor purchases:

• Miami: Down 19% year-over-year.
• Orlando: Down 13%.
• Fort Lauderdale: Down 12%.

Despite accounting for 30% of all home purchases in Miami during the first quarter, this figure reflects a decrease from a peak of 35% at the end of 2022.

Long-Term Trends

Investor purchases in major Florida cities like Miami and Orlando have dipped consistently since mid-2022, influenced by declining home prices and increasing costs of ownership.

Investor Market Share

Despite the fluctuations, real estate investors purchased approximately 19% of all homes sold in the U.S. in early 2025, maintaining a similar share compared to 2024 and slightly higher than in 2023.

Trends in Property Types:

• Single-family homes: Up 3% year-over-year.
• Townhouses and multi-family properties: Both saw a rise of 1%.

High vs. Low-Priced Homes

• Investor purchases of high-priced homes increased by 12% year-over-year.
• Conversely, purchases of low-priced homes dropped by 4%, but still comprised 46% of all acquisitions.

Conclusion

The U.S. real estate market is currently characterized by a cautious yet stable investor presence, particularly in single-family and high-priced homes, while the condo market faces notable challenges. As conditions evolve, the landscape is shifting in favor of traditional homebuyers, presenting opportunities for negotiation and choice.

For further insights into the U.S. housing market and investor trends, check out the full report on Redfin.

Explore more about housing market trends and data on the Redfin Data Center.