Charlotte sees big drop in houses being bought by investors
It appears that the days of corporations and investors buying up scores of houses in Charlotte may be coming to an end.
According to new data provided by Redfin this week, the Charlotte metropolitan area has seen a 66% drop in investor purchases of homes. That’s the second biggest drop of all metros in the country, according to Redfin, in a tie with Atlanta.
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The data from Redfin shows that the whole country has seen a 49% year-over-year decline in investor purchases of homes. The first quarter of 2023 saw investors purchase about 41,000 homes, which is near the rate at the beginning of the COVID-19 pandemic after a big spike over the last two years.
Redfin’s data speculates that investor purchases may be declining in Charlotte and Atlanta because those two markets were popular with iBuyer investors, which Redfin says “slowed operations in recent years.”
The real estate company added that elevated interest rates also led to investors pulling back from purchasing more homes. The average mortgage rate has jumped up to 6.79% compared to a valley of 2.65% in Jan. 2021, according to the Federal Reserve of St. Louis data.
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One more factor could be that investors are losing money in real estate. According to Redfin, a little over 17% of homes sold by investors in March were sold at a loss. That’s the fifth-highest rate in the nation, behind Phoenix, Las Vegas, Jacksonville, and Sacramento.
You can see the full list at this link.
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