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Fewer Tucson-area houses are being bought by investment groups looking to make a profit.
According to real estate data company RealtyTrac, institutional investors were responsible for 0.8 percent of local home purchases in May.
In May of 2014, they made up 9.8 percent of home purchases.
Institutional investors are buying fewer houses nationwide, and Tucson is one place that is very visible.
“These investors are really pulling out of the markets," said RealtyTrac Vice President Daren Blomquist. "And definitely when we look at Pima County, I mean it’s happening statewide in Arizona, but Pima County it really stands out.”
A drop in the number of foreclosures may be partially responsible for the slowing of institutional investor purchases.
According to the Tucson Association of Realtors, the average number of foreclosure filings per month in Tucson for 2015 is 295. That's the lowest monthly average since 2006.
Institutional investors tend to purchase homes that are moderately priced and often go for those that are offered at a discount.
Banks are no longer selling foreclosures at discounts to get them off the books, so the preferred market for institutional investors in Tucson is going away.
“The inventory for that just doesn’t exist any longer," said TAR's Nicole Brule-Fisher. "There’s been a shift in the market, so those large institutional investors don’t have access to those pools of properties that they used to.”
Both Blomquist and Brule-Fisher agree a drop in institutional investors could be a positive for first time home buyers and those looking to purchase a home to live in.
That's because those buyers tend to buy homes that are moderately priced, and such homes are a favorite target of institutional investors.
It's also a sign that the market is returning to a more normal, steady state of growth.
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