All-Cash Investment Home Prices in U.S. Rise 5.4 Percent Annually
Surpassing Annual Owner-Occupied Home Price Growth
According to Irvine, Ca-based HomeUnion's June 2016 data on the U.S. housing market, prices for investment properties purchased without leverage increased at a greater rate than traditional housing. All-cash prices jumped 5.4 percent year-over-year to a median price of $160,000, while the owner-occupied median sales price grew 3.3 percent to $253,600.
"As global economic upheaval weighed on investors decisions, single-family rental (SFR) investment homes remained a safe haven for many investors," explains Steve Hovland, director of research for HomeUnion. "Prior to the recent Brexit vote and ongoing uncertainty in the global equity markets, investors parked capital in real estate for its stable returns, which has resulted in higher investment home prices."
"Owner-occupied home prices are hovering near all-time highs, which is keeping many potential buyers on the sidelines and slowing price growth," adds Hovland. Sales price increased at a healthy clip, indicating ongoing stability in the housing market, partially fueled by historically low interest rates. The overall median sales price - including both owner-occupied and investment housing - increased 3.9 percent year over year to $234,500 in June.