Over one year ago we saw investors flood the market in record numbers – a practice which brought both good and bad elements to the RE community. On one side, these investors played a major role in driving up home prices, and helping boost the real estate recovery. On the other end, these investors pushed many would-be homeowners out of the market by starting large bidding wars and offering cash up front. Lately though, this practice appears to have come to a halt, leaving the market open to those who have previously been forced out by investor activity.
DataQuick recently reported that purchases have decreased drastically among the biggest buyers of California real estate this year – more than 70% year-over-year for the past four months. And Blackstone group – the largest of investors – has reduced its California purchases by more than 90% since this time last year.
The higher prices have made the market less attractive to investors and home buyers, but the reduced investor activity will open up more homes for buyers to choose from. Many experts also believe that we will likely see an expansion of homes on the market, offering a better balance between buyers and sellers and ultimately encouraging a healthier market.
We reported the March activity in Pasadena, and though the big-money investors are out of the market, prices, demand, sales and escrow activity is very vigorous. And stiff competition still exists among buyers who want a family home.
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