Arizona sees drop in institutional homebuyers
Why it matters: Investors, who often compete with first-time buyers, have pulled back from the U.S. housing market in recent years.
By the numbers: In the Phoenix metro area, institutional investors bought 7.5% of houses in the first quarter of 2025, compared with 8.2% in the same stretch last year.
The Arizona city with the largest share of houses bought by individual investors in the first quarter was Yuma, at 10%.
That's a 22% jump from the same period last year.
Tucson's rate dropped by 23%, to 5.7% of houses sold.
The big picture: Nationally, the total number of home sales to institutional investors in Q1 fell to its lowest rate since 2020 — mirroring a broader slowdown in the residential real estate market — even as their share of total sales ticked up to 6.3% from 6.1% in the previous quarter, per ATTOM.
Alabama's share was highest at 10.9%, while Maine's was lowest at 2.7%, among states with enough data.
Catch up quick: Corporate homebuyers have been a contentious issue in Arizona as the state grapples with a housing shortage that's driven up prices.
The League of Arizona Cities and Towns responded to this year's failed starter homes legislation with a counterproposal that would put limits on sales to investors.
Gov. Katie Hobbs proposed starter homes legislation to limit the percentage of the new homes that could be sold to investors.
In an op-ed in the Arizona Republic last year, Democratic state lawmakers Juan Mendez and Oscar De Los Santos argued that "price-gouging middlemen" keep houses out of would-be owners' hands, charge exorbitant rents and convert homes into short-term rentals.
Between the lines: Investors want to see strong population and job growth, solid rental yields, landlord-friendly regulations, affordability, and long-term appreciation potential, ATTOM CEO Rob Barber previously told Axios.
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