U
S real estate investors purchased 46,726 homes in the first quarter, a 2% increase from the same period last year. According to Redfin, this marks a return to pre-pandemic levels after investor purchases soared during the pandemic and then plummeted as mortgage rates increased and people stopped moving. Investors are now more cautious, buying homes when they expect a good financial return but holding off in uncertain situations.

    While some investors still make money by flipping homes or renting them out, many who entered the market during the pandemic have backed off. This has led to a decrease in investor listings, with less than 9% of total US home listings coming from investors in March, down from nearly 9% last year.

    Investors are also pulling back on condo purchases, with 8,509 condos sold in the first quarter, a 3% decline from the same period last year and the lowest level since the pandemic began. This trend is particularly notable in Florida, where it's becoming increasingly difficult to make money by renting out condos due to rising costs and decreasing demand.

    Investors who do sell homes are making a profit, with a median capital gain of $182,980 per home sold in March, up 2.8% from the previous year. However, just 6% of investor-sold homes were sold at a loss, indicating that many investors are being more selective about their purchases and sales.

    The shift towards more cautious investing is seen as a positive development for regular homebuyers, who now face less competition from investors and have more opportunities to negotiate prices or ask sellers for concessions.