Thanks to Visio's market knowledge and sizable database, they conduct an annual survey of residential investors at the s
the annual residential real estate
INVESTOR REPORT 2015
the annual residential real estate
INVESTOR REPORT Each year, leading residential real estate lender Visio Financial
Visio Financial, in business since 2011, has originated more than
Services conducts a survey of the residential investors in their
2,800 loans to investors exclusively, yielding a deep understanding
database to better understand their customers’ needs, as well as to
of the real estate investing space.
track growing trends in the ever-changing real estate market. Thanks to Visio’s market knowledge and sizable database, they With more than 14 million single-family rental properties in the
conduct an annual survey of residential investors at the start of
United States, the residential real estate investment market is a
each year. Real estate investors, whether they own two properties
multi-billion dollar investor opportunity annually. Further, it is
or 200, share their experience and plans, giving valuable insight
highly fragmented, with 68% of investors owning fewer than seven
into the residential real estate market. Visio provides the resulting
properties. Despite this market’s size, the fragmentation has meant
Annual Residential Real Estate Investor Report to investors, lenders,
very little analysis of this space.
analysts and anyone else interested in this massive market.
EXECUTIVE SUMMARY Investors Adapt to a Healthier Market
Market Ripe for Rapid Growth
• Investment Portfolio Growth: 49% of investors are planning on
• Working Capital: 92% of full-time investors believe that access to
buying four or more houses in 2015, compared to the 25% who actually bought four or more in 2014. • Higher Price Bands: $200K-plus
properties
63% than
more last
• Help Wanted: More than one-fifth of full-time investors need investors year,
are
whereas
considering
more high-quality employees and contractors in order to sustain
interest
their growth.
in
sub-$40K properties has decreased. • Broadened Property Searches: 34% of investors are searching for investment property out of their home states as local property deals dwindle.
lower-cost loans could grow their businesses faster.
• Career Investors: 83% of part-time investors expressed interest in going full time, provided they had more funding and quality deals. • Minority Growth Sector: African-Americans comprise 22% of the investor class, up from 15% in 2014, and significantly higher than the general population (13%).
01. INVESTOR PROFILE
Who are residential investors? Demographic highlights total population
2% 68%
13% 7% 10% 13%
Average age 52 years old
49%
64% married
77% 2.9 people in household
23%
65% employed full time
married single
8%
17%
11%
widowed other
44%
close to the national average of 2.6
investors
34%
full time
15%
22%
divorced/ separated
56% 66%
part time
African-Americans make up 22% of the investor class (up from 15% last year) versus 13% of the general population. This shows an upward trend of African-Americans entering the real estate investment space.
Investors mostly male, married Compared to national averages, residential investors in the U.S. are more likely to be male,
around 50%, investors are 28% more likely to be married. While 68% of male investors are
married and African-American. At 64%, the percentage of white investors matches the
married, only 49% of female investors are, with women more likely to be divorced (15% vs. 11%)
national average of 63%, but the proportion of investors who are black far exceeds the
or single (11% vs. 7%). Men were also much more likely to be full-time investors versus women.
national racial average of 13%. With the average number of married Americans hovering
©2015, Visio Financial Services | www.visiolending.com
3
02. INVESTOR INCOME
How much money are investors actually making? Breakdown of total household income
Investment income as percentage of total income
annual household income
$25K-$50K $50K-$75K $75K-$100K $100K-$125K $125K-$150K $150K-$175K
• On average, 36% of total household (HH) income was from residential investing
25% 20%
investors
The median investor has a total household income of $100K-$125K, more than twice the median income of the average American.
$0-$25K
• 25% of investors make
