Inman News
While home purchases by investors rose 2% annually in the first quarter — to 46,726 transactions — condo sales declined by 3%, to just 8,509 units, according to data released Wednesday by Redfin
Investor activity appears to be stabilizing, nearly returning to pre-pandemic norms. But within that trend lies a shift: investors are pulling back from condos.
While investor home purchases rose 2 percent year over year in the first quarter of 2025, with 46,726 homes purchased, condo sales fell 3 percent, down to just 8,509 units, new data released Wednesday by Redfin shows. That marks the lowest level for condo sales in a decade, excluding the pandemic era.
“Investor home purchases have leveled off because rapid sale-price and rent growth is no longer the norm,” Redfin Senior Economist Sheharyar Bokhari said in a statement. “While some investors are still making money by flipping homes or renting them out, particularly in parts of the U.S. where rents are still rising, many of the investors who jumped into the market in 2021 or 2022 have backed off.”
One of the main reasons for the condo slowdown is the growing concerns that they may lose value, particularly in Florida. Surging Homeowner Association fees, rising insurance costs and increasing exposure to climate-related disasters, especially for oceanfront buildings, are driving investor hesitation.
Florida is home to three of the five metro areas where investor purchases dropped most in Q1. Miami shouldered a 19 percent decline while purchases in Orlando and Fort Lauderdale fell 13 percent and 12 percent, respectively. Miami and Fort Lauderdale have both logged annual declines in investor purchases since 2022.
Still, investors maintain a strong presence in Miami, where 30 percent of all homes transaction during the quarter came from investors — more than any other U.S. metro.
But the cooling condo trend isn’t limited to Florida. Redfin agents in California and Washington, D.C. are also watching investors back off condos due to high HOA fees and rental challenges.
Today’s investors are acting with much more caution, targeting properties that promise better returns and lower risk. That’s reflected in where the money is going. Investor purchases in single-family homes rose 3 percent year over year in Q1, while purchases of townhouses and multi-family properties each rose by 1 percent.
In terms of market share, investors bought 34 percent of multi-family properties sold and 19 percent of single-family homes, townhouses and condos combined.
Price points have also played a huge role in shifting investor behavior. Purchases of high-priced homes increased 12 percent year over year in Q1 — the largest jump in three years — while mid-priced homes saw a modest 2 percent increase. Low-priced home purchases declined by 4 percent.
Still, nearly 46 percent of investor purchases in the first quarter of 2025 were low-priced homes, with high-end properties accounting for 30 percent and mid-price homes making up 24 percent.
There’s a small upside here for traditional buyers. Investor listings made up just 8.4 percent of all homes on the market in March. With investors stepping back slightly, regular buyers are facing less competition.
“While it’s still hard for the average American to afford a home, there are now more homes to choose from and individuals aren’t facing stiff competition from investors,” Bokhari said. “That allows buyers the chance to negotiate prices down, and/or ask the seller for concessions.”