While real estate investment purchases are falling into more stable patterns following wild pandemic-era swings, condo activity is lagging, falling to a 10-year low, according to Redfin.
U.S. investors bought a total of 46,726 units in the first quarter, up 2% year over year, the real estate brokerage reported. Early 2025 activity recovered from the
In the past 12 months, investment purchases have increased or shrunk by less than 4% in each direction, compared to the wide fluctuations between 2021 and 2023, as investors tried to take advantage of low interest rates in a hot housing market.
"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," Redfin senior economist Sheharyar Bokhari said in a press release.
Numbers today are instead now similar to pre-pandemic volumes. "Investor home purchases have leveled off because rapid sale-price and rent growth is no longer the norm," Bokhari noted.
The investment community bought approximately 19% of homes sold in the first quarter, on par with year-ago levels and up from 18% in the first three months of 2024.
In March, fix-and-flip entrepreneurs and businesses earned a net profit of $182,980 for each home they sold, with gains increasing 2.8% from a year earlier. Six percent of homes sold for a loss, compared to 5% 12 months earlier.
For-sale homes listed by investors made up 8.4% of the total housing market in March, tumbling to an almost two-year low from the 8.9% share one year prior.
What's causing condo purchases to plunge
Although purchase volume returned to positive territory at the start of the year, investors bought the fewest number of condos in 10 years, with the exception of COVID-impacted 2020, Redfin said.
Concerns over depreciating condo values drove investor purchases downward to just 8,509 units in the first quarter. Transactions dropped 3% year over year.
Redfin's research previously determined 68% of the overall number of condos sold to start 2025 went for below list price, the highest percentage in five years.
Florida's rising housing costs are causing much of the condominium downturn, with
HOA fees are behind soft condo sales elsewhere in the country as well, as investors are finding them difficult to rent.
"People who own condos as rentals are trying to offload them because the money no longer makes sense. And people aren't buying condos to rent them out anymore unless they have cash to burn," said Stuart Naranch, a Redfin agent based in Washington, D.C.
Why Florida's condo market is seeing the most decline
But whether its condominium units or other property types, nowhere is the investor pullback felt more acutely than in the Sunshine State, Redfin's researchers said.
Of the five metropolitan markets registering the largest pullback in investment purchase activity, three were located in Florida, with Miami seeing a 19% annual drop to lead the U.S. Still, Miami investors hold the largest investor market share of any major U.S. city, buying 30% of properties for sale in the first quarter.
Orlando landed in the second spot with a 13% year-over-year decline. Following just behind were Warren, Michigan, and Columbus, Ohio, with similar 13% dropoffs, while Fort Lauderdale saw activity fall 12%.
Miami, Orlando and Fort Lauderdale have all reported annual decreases in buying activity for each quarter since mid 2022.
