According to a recent article by Oregon Live.com and a new report from Realty Trac, "institutions bought more Portland area homes in the third quarter of 2014, then they did in the previous quarter and the same period just a year ago." However, investors still make up a small percentage of home buyers at just 2.8%.
Most of these investors are cash buyers buying more homes in the metropolitan area and statewide in the third quarter. Cash buyers accounted for one in four home purchases throughout 2014 so far.
Also, institutional investors are actively purchasing single-family homes for rentals and continue to gravitate toward markets where lower-end inventory is still available. This coincides with a rebound in distressed sales attracting deal hunters where cash is king.
Across the board nationwide, "all cash sales accounted for 33.9% of all sales of single-family homes and condominiums in the third quarter of 2014. This is actually down nearly 37% in the second quarter and about the same as last year."
Cash sales still play an important role in the real estate market. Nationwide they represent one in three home sales. As institutional investors slow down their purchase of these types of homes in many markets across the country more traditional buyers such as first-time homebuyers and move-up buyers will be able to purchase these types of homes and maintain the momentum of the housing recovery.
We are seeing a huge boom in investor and cash homebuyers throughout the Portland real estate market. This is not to say that first-time homebuyers or move-up buyers have any less advantage, especially since many of the homes are not short sales or foreclosures any longer, but it can mean that the competition is still pretty stiff.