A sold sign is for sale in front of a home on August 27, 2025 in San Francisco, California.
Justin Sullivan | Getty images
A version of this article first appeared in the CNBC Real Estate newsletter with Diana Olick. The real estate game encompasses new and evolving opportunities for the real estate investor, from individuals to venture capitalists, private equity funds, family offices, institutional investors and large public companies. Sign up to receive future issues straight to your inbox.
Real estate investors, both individual and institutional, purchased a third of all single-family homes sold in the second quarter of 2025. This is up from 27% in the first quarter and the highest percentage in the last five years. This is according to a report by CJ Patrick Co. Investors accounted for 25.7% of residential sales in 2024.
While the revenue share is higher, the raw numbers are lower. Investors in the second quarter of this year bought 16,000 fewer homes than a year ago, but home sales this year were much weaker than last year. This accounts for the profit in the investor share. Investors continue to own about 20% of the country’s 86 million single-family homes.
“While investors bought more homes than in the second quarter, they sold over 104,000 homes, with 45% of sales going to traditional buyer buyers,” said Ivo Draginov, co-founder and chief innovation officer at Batchdata. “In addition to playing an important role, investors continue to provide necessary liquidity for a weak household sales market, but also bring much-needed inventory – both rental properties and owner-occupied homes – to market.”
While large institutional investors continue to get most of the headlines in single-family lending, small investors make up more than 90% of the market. These are people who possess 10 traits or fewer. The largest investors, those with 1,000 or more properties, account for only 2% of all investor-owned homes.
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Unlike individuals, institutional investors are now selling more homes than they are buying and have been for six consecutive quarters. The largest landlords in the country, invitation houses, progress in residential areas, American Houses 4 Rent And FirstKey Homes sold more homes than it bought in the third quarter of this year, according to analysis by Parcl Labs.
“They are not leaving the space and diverting capital into building communities. However, this shift means less competition for small investors and traditional home buyers while adding more rental supply, which is needed in today’s market where younger adults may often choose to rent because they cannot afford to buy a home,” said Rick Sharga, founder and CEO of CJ Patrick Co.
Regionally, Texas, California and Florida have the highest number of investor-owned homes. This is mainly because they are also the most populous states. The states with the highest percentage of investor-owned homes are Hawaii, Alaska, Montana and Maine. These are also serious tourism conditions.
Investors have always focused on cheaper homes because they can make the best profits in the resale years. In the second quarter of this year, investors paid an average of $455,481 per home, according to the CJ Patrick report – well below the national average price of $512,800. However, it was the highest average investor price in the last six quarters as overall property prices continue to rise.
Investor homes are typically either smaller or in cheaper housing markets. Large investors even purchased cheaper homes than the overall pool, with their average purchase price at $279,889. Their average sales price was $334,787. Institutional investors are most concentrated in the Midwest and South, where prices are below the national average.
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