More than one of every three home investors plans to sell their properties within a year, according to a recent report from the California Association of Realtors.
Fast-rising home prices – double-digit year-over-year gains for 13 consecutive months – historically low interest rates and a recently struggling stock market have encouraged more investors to look at real estate during the past four years.
Three of every four investors are considered mom-and-pop buyers, owning less than 10 investment properties – with about half of those owning two to five homes.
About one of every four investors was a foreign buyer, with many from China, India and Mexico.
The median-home price for an investment property was $272,500, allowing two-thirds of investors to pay cash. And 80% of those investors spent at least $10,000 in repairs for those properties. Homes under $250,000 required a larger percentage of repairs than those above $500,000, 4.2% vs. 3.4% of the purchase price.
Finally, two-thirds of investors manage their own properties.