In the ever-evolving world of Real Estate, the idea of investing may seem reserved for large corporations and institutional giants. However, the reality is far more relatable, with many ordinary investors, perhaps even your friends or neighbors, actively participating in the market.
Let’s dive into the data to uncover the truth. According to SFR Investor, out of the eighty-two million single-family homes in the United States, nearly eighty-three percent (68 million) are owner-occupied. This leaves around fourteen million homes categorized as single-family rentals (SFRs). The common assumption that institutional investors own the majority of these homes is debunked when we break down the investor categories:
- Mom & Pop Investors (1-9 SFRs): 45.41%
- Regional Investors (10-99 SFRs): 33.42%
- Smaller National Investors (100-999 SFRs): 16.46%
- Institutional Investors (1,000+ SFRs): 4.71%
Contrary to popular belief perpetuated by news and social media, the chart illustrates that institutional investors represent the smallest portion. The majority of rental homes are owned by small-scale investors, the mom and pop variety – individuals much like your friends and neighbors. They are driven by the belief in homeownership, purchasing second homes as investments, either for rental income or simply to retain a property when moving up the housing ladder.
In essence, the narrative that institutional investors dominate the market, making it challenging for ordinary individuals to buy homes, does not align with the actual statistics. While institutional investors play a role, they are not the primary driving force. Instead, it’s the collective actions of everyday people, like you, who view homeownership as an investment opportunity.
If you have questions or seek a deeper understanding of the housing market dynamics and/or explore the possibilities of Real Estate investment, we would love to help you! Connect with us SHEA PREFERRED REALTY, your trusted Real Estate team!
Source: SFR Investor
