Investor Home Purchases Fell 6% in Q1 2026

Seattle, WA, June 1, 2026– U.S. investor home purchases fell 6% year over year in Q1 2026 to their lowest level since 2020, when the start of the pandemic ground homebuying to a halt, says Redfin. Prior to 2020, the last time investors bought so few homes was in 2016.

Investor home purchases fell in Q1 largely because elevated housing costs squeezed potential returns. While mortgage rates were slightly lower in the first quarter than recent peaks, dipping into the low-6% range from near 7% throughout 2025, they’re still double pandemic-era lows. Home-sale prices are still rising in most of the country, too. That makes it more expensive for investors to buy properties, and reduces the profitability of rental properties and flips. 

A cooler housing market is also playing a role. Home-price growth has slowed in much of the country, and in some markets, prices are falling. That gives investors less confidence that homes will quickly rise in value. At the same time, rising insurance premiums, property taxes and maintenance costs are cutting into margins, particularly for smaller investors. 

Investor gains are losing steam. The median capital gain for a home sold by an investor was $196,618 in the first quarter, up 5.3% year over year. But that pales in comparison to the double-digit gains common in 2020 and 2021. 

The rental market is cooling, too. That makes it harder for investors to make the case to become a landlord.