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Investors buy record share of U.S. homes

Chairman of the Senate Committee on Banking, Housing, and Urban Affairs Sen. Sherrod Brown, D-Ohio, in Washington, D.C., on July 15. Brown said corporate investors are driving up home prices and rents for individuals. Photo by Sarah Silbiger/UPI
Chairman of the Senate Committee on Banking, Housing, and Urban Affairs Sen. Sherrod Brown, D-Ohio, in Washington, D.C., on July 15. Brown said corporate investors are driving up home prices and rents for individuals. Photo by Sarah Silbiger/UPI | License Photo

Feb. 16 (UPI) -- Investors bought a record share of U.S. homes during the fourth quarter of 2021, according to a Wednesday report from Redfin.com.

Redfin said a record 18.4% of homes sold during the fourth quarter were bought by investors. That's up from 12.6% a year ago.

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Real estate investors bought 80,293 homes in the fourth quarter, according to Redfin.

According to a Washington Post analysis of Redfin's data 30% of home sales in majority Black neighborhoods were to investors.

That compares with 12% in other ZIP codes, according to the Post.

These investors can be big corporations, wealthy individuals or local companies.

"We know historically that places where minorities live are undervalued or lower priced," economist Sheharyar Bokhari told the Post. That can make those homes more attractive to investors, but it drive up prices for individual buyers.

During a hearing in Washington last week U.S. Sen. Sherrod Brown, D-Ohio, chair of the Senate Committee on Banking, Housing and Urban Affairs, said these corporate investors are driving up home prices and raising rents.

Redfin said 75.3% of investor home buys were cash purchases during the fourth quarter of 2021.

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"While record-high home prices are problematic for individual homebuyers, they're one reason why investor demand is stronger than ever," Redfin economist Sheharyar Bokhari said in a statement.

Bokhari said investors are chasing rising prices while rental prices are also skyrocketing.

Meanwhile, rising home prices and interest rates have contributed to a decline in mortgage demand, according to the Mortgage Banker's Association.

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