During the housing bust, investors pounced on foreclosures and short sales—houses that sell for less than the amount owed on the mortgage—to use for cheap homes they could rent out or flip for a quick profit. Now, those easy pickings are gone, but the investors are still swarming over local housing markets, offering all-cash deals and creating headaches for the first-time home buyers who compete with them. ...
US real estate investors who capitalised on buying homes in foreclosure and short-sales houses during the recession in order to gain large rental and re-sale profits are now monopolising the market once again, edging out first-time buyers by offering all-cash deals on home purchases. With higher foreclosure start rates, and cash investments in some US cities remaining far above historical levels, first-time buyers of low-price homes are now competing for fewer properties. According to the National Association of Realtors, the supply of homes for sale declined to 1.79 million in December 2015, and over the last year those priced below $100,000 fell 11.1%. As housing prices are expected to cool during 2016, investors are favouring rentals. In Q4 2015, the median asking rent was $850 pcm, up from 11% in 2014.