A recent study by lendingtree ranked the top 10 cities in America with the most non-owner-occupied loan originations. They suggest that the lack of inventory in market is being exacerbated by a “lock-in” effect where current owners are dissuaded from selling and moving as their new home would be at a higher interest rate. In addition, they say non-occupant buyers are crowding-out homebuyers by making a market more competitive and forcing prices higher. Indeed…
“Our study looks at the share of mortgages made for non-owner occupied properties to gauge their impact on inventory. Non-owner occupied properties are either vacation homes, investment properties or second homes. Many such properties are often bought for cash, however, which means our mortgage focused-study likely understates the effect on the market.”
