The old expression “follow the money” can be applied to several different aspects of life. Sometimes it’s as simple as tracking trades in the stock market and sometimes following the money can disclose corruption in government at all levels. But for the sake of this column, we’ll follow the real estate money – and it’s taking a new, surprising turn.
As we briefly discussed last week, the housing market, with some exceptions, is slow all over the country. The much-anticipated spring selling season has become a complete dud and everyone in the industry is pinning their hopes on a large interest rate cut in September.
Nevertheless, single-home investors are alive and well and are dominating the real estate market so far this year. The interesting thing is the profile of investors has changed significantly. Previously, investment buyers were predominantly large private equity firms, however, the majority of buyers for these properties now are small investors; small investors are defined as owners with 100 or fewer properties.
According to Cotality, a property analytics firm, so far in 2025, investors have made up about 30% of purchases of both existing and newly built single-family homes, the highest share on record. In addition, in the first half of the year, small investors made up about 25% of investment home purchases, while large investors accounted for about 5%.
The question is, why is this happening? Obviously, small investors are not deterred in spite of high prices and high interest rates; they still see a pathway to maximize their investment. Smaller investors also have the ability to take more risk since they are making their own decisions without the oversight of a board of directors. It also works for them since so many traditional homebuyers have stepped back waiting for some signal that the market is improving.
Based on what is going on with the condo market across the country, some of those investment buyers would be smart to take a look at advantageous buying options on condo properties. Condo sellers haven’t faced a market this weak in more than a decade. Prices are down, supply is up and sellers often feel lucky to get an offer.
This is particularly true in the south and naturally, Florida condos – which play a major role in our housing market – are being impacted the most. The Florida condo market accounts for 16% of all home sales compared with just 10% of home sales nationwide. Coastal condos, as we know, are hurting the most as home insurance and new safety regulations have increased HOA fees.
All of this is true and there is no denying it. However, although I don’t have statistics to prove my theory, I do believe the east coast of Florida is suffering more with condo sales than the west coast. This, I believe, is a reflection of the Surfside building collapse in 2021 and also the age of the buildings and the deferred maintenance on so many of the oceanfront properties. I hear much less about condos in our area failing the milestone structural inspections mandated by the state and ones that have appeared to be on a smaller scale.
Even though single-family homes are selling at a stronger pace than condos, remember, Florida loves condo living – it’s why people came here. Certainly, marketing a strong, storm-survived condo building will be beneficial to your sale and of course should be on your listing information.
Follow the money, and the money is with small investors. Watch what they’re buying and keep an eye on those condos.
