Prediction: 3 times more investors than owner-occupants for home sales

Real Estate Agent with Century 21 All Stars

New survey finds significant investor interest in buying homes, and many don't expect to pay all cash. They're not planning quick flips, either.

Posted by Teresa at MSN Real Estate on Thursday, May 26, 2011 9:37 AM

© Ron Chapple/Getty ImagesWho is planning to buy homes in the next two years?




Already a significant share of people buying homes today, investors will be three times as active as conventional homebuyers in the near future, according to a new survey by

"This data suggests today’s climate is hot for investing and is attracting a lot of new people that don’t fit the stereotypical deal-driven flippers that buy and sell properties quickly," Move Chief Executive Officer Steve Berkowitz said in a news release.


According to the survey, 50% of the prospective real-estate investors plan to hold their properties for five or more years, and only 11% expect to sell within a year of their purchase.

Though all-cash buyers make up a significant percentage of those buying homes today (31% in April), 75.5% of investors expect to borrow at least some of what they need. The survey didn't indicate how they'd accomplish that, but 57% of those surveyed said finding financing is a challenge.<!--EndofExcerptMarker-->

The investors expect the problems that conventional homebuyers are having getting mortgages will help them compete for the best properties.




"The fact that most real-estate investors plan on combining cash and credit for their purchases goes against the conventional wisdom that investor transactions today are mostly cash-only sales," Berkowitz said.



The survey echoes the findings of a poll by Econohomes, which reported in March that small investors were playing a key role in the market. "Our overriding conclusion from this report is that small, local investors are a critical ingredient in the recipe to solve the housing crisis and stabilize the economy as a whole," Econohomes concluded.




Here are some other findings of the survey on investors:


  • 22% expect prices to rise in the next six to 12 months, 23% expect prices to fall and 53.5% expect prices to remain about the same.
  • 59% are new to real-estate investing, and only 36.5% have made more than one purchase.
  • 65.7% don't expect repair costs to exceed 20% of the purchase price.
  • 48% expect a profit of 20% or more from their investment, or a 4% annual return over five years.
  • 27% plan to buy a personal residence as their first investment.
  • 30% are interested in buying retirement property as an investment.
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Curt Baumgarth

CDPE Certified Realtor

Century 21 All Star Realtors

480 266 9796 

About Curt:  Curt Baumgarth is an AZ License Realtor, MAOM educated,  SEVAR member, a Certified Distressed Property Expert and longtime resident of the Valley of the Sun.  Curt is a former Police Officer in the valley and also has several investment properties and is more than happy to share any of his vast experiences and knowledge with you.

Are you considering a Foreclosure or Short Sale, contact Curt Baumgarth, who is a Certified Expert in Distressed Properties and can give you honest answers and guide you through the complicated procedures that it takes to SUCCESSFULLY complete such a sale or purchase.

Contact Curt if you are interested in buying or selling any type of residential property in the greater Phoenix, Scottsdale, Tempe, Mesa, Gilbert, Chandler, Queen Creek area. 


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