Who’s Buying the House Next Door? The Investor Surge & Its Local Impact
I try to find an interesting segment to discuss on a weekly basis… and this week had a plethora of options.
I considered writing about “The Affordability Whiplash” — The drop in mortgage rates has caused an early November application surge. I was curious to explore if this is a short-term bump or a signal that 2026 buyers are already back.
I also considered writing about “The Shrinking Seller Pool” — how nationwide, new listings are down 8%, but pending sales are up. You know me… I was curious what that imbalance could mean for MA & RI winter pricing and if the stats hold true in our market.
But while checking the news this morning, I ran across an article on X that referenced a CNBC segment claiming investors bought roughly ⅓ of US single-family homes in Q2 2025. Ultimately, this needed to be explored… because this isn’t the first time the issue of corporate home purchases has come up in the last few years. It’s been a hot topic!
That is the highest share in five years and, in light of President Trump and Secretary Pulte pushing the potential for 50-year mortgages due to lack of affordability… I think it’s the most relevant item to explore this week.
The cited Investor Pulse (Q2 2025) report pegs it near 33%, while Redfin’s methodology shows about 16% for SFRs nationally the same quarter. The split isn’t a contradiction so much as a definition fight: different data sets and inclusion rules (e.g., when small “mom-and-pop” LLCs count as investors) can double the number.
In my opinion, the numbers should include even small LLCs as any property purchase by an intended non-owner occupant reduces potential inventory available to home buyers and can lockup property for long periods of time keeping lack of inventory, and with it price elasticity, an ongoing issue for the foreseeable future.
That means a continued rise in prices, even a slow rise, and a continued affordability strain… which leads to socialists being elected in our major cities because our younger generations don’t see a path to the “American Dream”... so why not burn it all down, right? That’s a discussion for a different day.
Either way, investor activity is elevated—and that matters for affordability and competition.
And that is what is driving national debate right now.
Are MA & RI seeing the same thing?
We don’t have a single public stat for “investor share” in MLSPIN or Statewide MLS, but regional signals rhyme with the national picture:
Massachusetts inventory rose year-over-year this fall while months of supply stayed lean—conditions that attract yield-seeking buyers who can move fast or pay cash.
Flips are tougher (profit margins hit a 17-year low nationally), nudging investors toward buy-and-hold rentals rather than quick resales. In practice that supports the “investors still active” thesis, just with a longer-term strategy.
Local policy winds (e.g., RI’s push on non-owner property surcharges starting 2026) signal that New England officials are watching ownership patterns closely. This is nothing new as we’re seeing legislation getting through the State House and that doesn’t happen overnight.
Are these homes ending up on Airbnb/VRBO?
In MA’s big metros, short-term rentals are regulated and registered, with Boston’s ordinance limiting many STRs to owner-occupied units. Cambridge is exploring direct data-sharing with Airbnb/VRBO to tighten compliance. State data also shows ~118,000 “seasonal/recreational” units (≈4% of stock)—a useful ceiling for how many homes could operate like de-facto STRs. Net: a portion of investor buys become STRs (especially in coastal markets), but a substantial share in MA/RI likely ends up as long-term SFR rentals, not nightly stays—particularly with enforcement tightening and flip math weakening.
What this means to Buyers and Sellers
First-time buyers: Focus on speed + certainty. Underwrite early, consider flexible close dates, and pair modest appraisal-gap coverage with inspection transparency (in RI only - a new law in MA that went into affect October 15th makes that illegal).
Sellers: Investor offers can be clean and quick, but don’t undervalue exposure—maximum marketing still drives competitive price discovery. And if you need to beaten over the head with this message, private/exclusive listings are RARELY the right path for the majority of home sellers.
Investors: With flip margins pinched, buy-and-hold pencils better here. Check municipal STR rules before underwriting nightly rates as rules can vary widely across the Commonwealth and the State of RI.
🧾 References
BatchData. (2025, September). Investor Pulse™ Q2 2025. Retrieved from https://batchdata.io/investor-pulse-q2-2025
Sherman, E. (2025, September 29). Investor share of home purchases hits five-year high in Q2. GlobeStreet. Retrieved from https://www.globest.com/2025/09/29/investor-share-of-home-purchases-hits-five-year-high-in-q2/
Yahoo Finance Staff. (2025, October 13). Investors purchased 33% of single-family homes in Q2, report finds. Retrieved from https://finance.yahoo.com/news/investors-purchased-33-single-family-163104147.html
National Mortgage Professional. (2025, September 26). Small investors dominate the single-family home market. Retrieved from https://nationalmortgageprofessional.com/news/small-investors-dominate-single-family-home-market
