The U.S. housing market is seeing a notable shift: small-scale real estate investors—defined as those owning fewer than 100 properties—now account for nearly 30% of all single-family home purchases, the highest percentage recorded in the past 14 years.

Why Are Small Investors Buying More Homes?

These buyers are largely paying in cash and targeting homes in the $250,000 price range, a segment that traditionally serves first-time homebuyers. Many of these investors are purchasing homes to rent out, with average rents hovering around $2,200 per month.

Builders Are Fueling the Trend

In markets with higher housing inventory, especially Texas and Florida, builders are enticing buyers with steep price cuts—over 38% of builders reported price reductions in July. While large institutional investors have slowed their buying due to tighter financing conditions, smaller investors are stepping in and filling that void.

Impact on First-Time Buyers and Local Markets

For traditional buyers, especially those looking for starter homes, competition is becoming tougher. With cash buyers often outbidding those using conventional financing, entry-level buyers may find it harder to secure a property in their desired price range.

This trend is also making its way to southeastern Pennsylvania, where some communities still have homes in these price brackets. Agents in the Philadelphia suburbs—particularly the ring and outer suburbs—are already seeing increased competition and tighter inventory, impacting how buyers and sellers approach the market.

What This Means for Buyers and Sellers in Pennsylvania

If you’re a first-time homebuyer, you may need to act quickly and work with an experienced local agent to navigate competitive conditions. For sellers, this surge in investor activity can present opportunities, particularly if your home is priced under $300,000 and in a desirable location.

As your local real estate experts, we’re monitoring these trends closely to help our clients make smart decisions, whether buying, selling, or investing.

Source: NY Post, July 28, 2025; Wall Street Journal, July 28, 2025