In February, 5.9% of all U.S. property sales were purchased by institutional investors (defined as an individuals or groups that have purchased at least 10 properties in a calendar year) down from 7.2% of sales the year before, according to data from real-estate data firm RealtyTrac. February was the third consecutive month the share of institutional investor purchases declined, after 19 consecutive months of year-over-year increases. Investors are cooling on markets like San Jose and Sacramento, Calif., Las Vegas and Phoenix, where prices have accelerated. “Supply and demand have reached a bit of a standoff in this uneven real estate recovery,” says Daren Blomquist, vice president at RealtyTrac.
So if institutional investors are backing out, should individuals as well? “Regular homebuyers are not likely to step in,” says Susan M. Wachter, professor of real estate and finance at The Wharton School at the University of Pennsylvania. The national median sales price of U.S. residential properties — including both distressed and non-distressed sales — was $164,667 in February, down 1% from the previous month, but still up 4% from February 2013.
By Q Fottrell at Marketwatch