Buying a home these days isn’t easy. You’re checking out listings, hurrying to open houses, and might even be facing some stiff competition from other buyers. You may have come across the idea that the challenge in finding a home is due to major Wall Street investors coming in and buying up properties left and right.

That’s mostly a myth. Although investors do play a role in the market, they only make up a small portion, according to Redfin.

Five out of every six homes are being bought by regular homebuyers like you, rather than large investors.

Before you feel discouraged, let’s explore what’s really happening. You might be surprised to find out that Wall Street isn’t as much of a competitor as you might believe.

Most Investors Are Small Mom-and-Pops

Most investors aren't those big-name corporations you often hear about. Instead, many of them are just like you and me—your neighbors. A recent report from CoreLogic highlights that most investors are smaller, mom-and-pop operations, owning fewer than 10 properties. These aren’t huge companies with unlimited resources; think of your neighbor who has a rental home or a vacation property.

Only about 1% of the market is controlled by large, mega investors who have thousands of properties. The bulk of the market is still made up of individual owners and smaller investors, rather than Wall Street giants.

Investor Purchases Are Declining

Most investors tend to be small-scale, and overall, investor purchases are decreasing. According to the same report from CoreLogic, this trend is evident.

““Investors made 80,000 purchases in June 2024, compared with 112,000 in June 2023, and a nearly 50% percent drop from the high of 149,000 purchases in June 2021 . . .”
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— CoreLogic

What does this mean for the future? CoreLogic indicates that this downward trend is likely to persist into 2025.

If you feel like investors are making it tough for you in the market, it's worth noting that their activity is actually starting to slow down.

Bottom Line

The notion that Wall Street is snapping up all the homes is mostly exaggerated. In reality, the majority of investors are small-scale ones, and the percentage of homes bought by investors is actually going down. So, you can cross this concern off your list.

Got questions about the housing market? Let’s chat.