Tri-Cities institutional investor home sales decline


TRI-CITIES, Tenn. – Despite the local buzz, and “we buy houses” signs local institutional investor sales were down last year.

According to ATTOM Data Solutions, there were 289 local institutional investor sales last year. ATTOM defines an institutional investor sale as a residential property sale to non-lending entities that bought at least 10 properties during a calendar year.

That doesn’t mean investors were less active than in the past year. ATTOM’s report doesn’t focus on investor sales other than the institutional variety. The market share of cash sales in each local metro area increased, and some of those sales were undoubted to investors who didn’t meet the institutional criteria.

Most of the institutional sales were in the four-county Kingsport-Bristol metro area. There were 173 of them, and they accounted for 3.7% of all sales. The previous year’s market share was 5.1% of all sales.

The three-county Johnson City metro area had 125 institutional sales, accounting for 3.6% of that region’s sales. The previous year’s volume was 5.2% of all sales.

The highest market share of Tri-Cities sales to institutional investments since 2014 was during 2021.

U.S. investor sales accounted for 6.5% of all single-family and condo sales in 2022, according to ATTOM. The volume was down from 8.1% of sales in 2021.

Cash sales accounted for 38% of Johnson City metro area single-family and condo sales during 2022, up from 34.2% the previous year.

Kingsport-Bristol’s cash sales were 37.5%, up from 33.1% the previous year.

ATTOM’s cash sales data differs from the Northeast Tennessee Association of Realtors (NETAR) reports because they include all sales from courthouse records and the NETAR numbers for sales listed on the local Multiple Listing Service (MLS).

Nationwide all-cash purchases accounted for 36.1% of all existing home sales. That’s the highest percentage since 2013.

Cash sales in the Johnson City metro area peaked in 2014 at 40.7%. Kingsport-Bristol peaked the same year with a percentage of 41.1%.

“Cash buyers – many, but not all of whom are investors – are in a position of competitive advantage in today’s higher interest rate environment and will continue to account for a higher-than-usual share of the market at least until mortgage rates dip back down a bit,” Rick Sharga, executive vice president of market intelligence at ATTOM said. “With affordability a problem for many buyers – especially first-time buyers – it wouldn’t be a surprise to see the percentage of cash purchases actually increase in 2023.”

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