Why Homes Feel So Expensive And What’s Really Driving It

You might have heard complaints like: “Homes cost so much now because investors are buying everything.” It’s a convenient narrative—but it misses a much more fundamental issue. According to national data, only a very small percentage of purchases are made by large investors. The bigger culprit? There simply aren’t enough homes to meet demand.

Investors Aren’t the Main Story

It turns out investor purchases account for only a fraction of the housing market. Big-scale investors (those owning dozens of homes) make up a small share of total home sales. So while headlines may point to “investor buying” as the reason prices are skyrocketing, the data doesn’t support that as the primary driver.

The Real Issue: Supply Comes Up Short

What’s consistently lifted home prices is this: demand overstretching the available housing stock. Simply put, not enough homes are being built or listed relative to the number of households seeking to buy. This scarcity creates pressure on pricing—new buyers compete for fewer listings, driving up what they’re willing to pay.

What This Means for You as a Buyer or Seller

As a buyer:

• Understand that the challenge isn’t just interest rates or investor hype—it’s competition for limited inventory.
  
  

• Timing and positioning matter. When more listings hit the market, you’ll have choice; when supply dwindles, affordability tightens.
  
  

As a seller:

• Your value isn’t necessarily driven by investor trends—it’s supported by the broader shortage and steady demand.
  
  

• While you might not expect the rapid price gains of recent years to continue, your property still holds value because of the underlying supply constraints.
  
  

If you’re scratching your head wondering why homes cost so much, it’s not just because big investors are buying everything. The bigger truth is simple but powerful: there just aren’t enough homes. That shortage has allowed prices to rise, even as other parts of the market shift.

Whether you’re buying or selling, having the right perspective matters. Recognizing the supply-driven nature of the market can help you make smarter decisions—about when to move, how to position yourself, and what to expect going forward.