The pandemic may have lent itself to great buying conditions for investors, but post-pandemic sales are proving to not be as fruitful.
According to new numbers out from Redfin, roughly one of every seven U.S. homes sold by an investor in March sold for less than the investor bought it for. That’s comparable with February’s 14.5 percent rate—the highest since 2016. It’s also nearly triple the share of a year earlier and far above the record low of 2.8 percent last May.
By comparison, 4.8 percent of overall U.S. homes that sold in March sold at a loss.
The typical investor who sold a home in March sold it for 45.9 percent more (or $145,714) than the price they paid, down from 55.3 percent (or $173,458) a year earlier and a pandemic peak of 67.9 percent (or $199,274) in June 2022.
As elevated mortgage rates curtail homebuyer demand, Sacramento, Phoenix and Las Vegas investors took even bigger hits.
According to Redfin, in Phoenix, 30.7 percent of homes sold by investors in March sold at a loss—the highest share of the 40 metros Redfin analyzed and more than double the national rate. Next came Las Vegas (28 percent), Jacksonville (20.9 percent), Sacramento (20.2 percent) and Charlotte (17.4 percent).
Investors are less likely to lose money in select South Florida markets, including West Palm Beach, Miami and Fort Lauderdale.
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