DALLAS (KDAF) — A new report from the National Association of Realtors says that institutional investors are buying more houses in a market with less homes to buy.

According to a report, the share of institutional home buyers rose from 11.8% in 2020 to 13.2% in 2021.

The report classifies institutional investors as companies, corporations or limited liability companies. Officials from the NAR say they were able to track institutional buyer purchases by using deed records.

As for the states where institutional investors are buying the most, Texas comes out on top. In 2021, institutions made up 28% of home purchases in Texas, with Georgia (19%), Oklahoma (18%) and Alabama (18%) following behind.

So why these states?

“Institutional buyers tend to purchase in markets with rising household formation, strong housing and rental markets, high-income markets, but also with a high density of minority groups especially Black households, with twice as many Black households in markets with higher share of institutional buyers,” the report said.

Officials hypothesize ten factors that make a market more enticing to an institutional investor:

  • Higher household formation
  • High density of minority groups
  • High density of renters
  • High density of Millennials
  • High income and education
  • Many people moving into the area
  • Fast rent growth
  • Fast home appreciation
  • Fast home sales growth
  • Lower rental vacancy rate

So what areas of Texas did institutional investors buy more houses in? Here are the following Texas counties with the largest shares on institutional investors:

  • Tarrant County – 52%
  • Midland County – 44%
  • Dallas County – 43%
  • Travis County – 41%
  • Denton County – 39%
  • Harris County – 38%
  • Kaufman County – 38%
  • Williamson County – 37%
  • Collin County – 34%

For the full report, click here.