First-time buyers need an estimated $126,700 a year to afford a median home, up more than 50% from 2021

In the first half of 2025, investors were behind roughly 30% of all single-family home purchases — including both new builds and resales — marking the highest share since property analytics firm Cotality began tracking the market 14 years ago.

With traditional homebuyers squeezed out by high prices and persistently elevated interest rates, smaller investors have taken a growing foothold in the housing market. “It’s not just the Blackstones of the world anymore,” said Rajan Bhatt, president of Strand Capital, which has purchased about 100 homes in cities like Chattanooga and Indianapolis.

While major institutional investors like Blackstone and Starwood Capital once dominated, they’ve scaled back amid rising borrowing costs and increased regulatory scrutiny. Now, smaller players — those with fewer than 100 homes — are making up about 25% of all purchases, while large investors account for just 5%, according to Cotality.

These small-scale investors are moving swiftly in a market many others view as risky. Often paying in cash and negotiating discounts, they’re seizing opportunities as traditional buyers and big firms pull back. “We’re acquiring at a fraction of what we were several years ago,” said Chris Avallone, CFO of Amherst, which owns 46,000 homes.