Inside the Midwestern state where real estate investors are snapping up a record share of homes

Real estate investors are buying up soaring numbers of homes in the Midwest, new data shows.

Investors purchased 14.8 percent of homes in the first quarter of 2024, according to the Realtor.com 2024 Q1 Investment Report - the highest percentage on record since the group began tracking in 2001.

Missouri is the hottest market with three cities ranking in the top five for the highest share of investor purchases. 

In Springfield, investors purchased 20.5 percent - nearly 1 in 5 - of homes. In Kansas City 20.1 percent and in St. Louis 18.9 percent of purchases were made by investors.

'Investors are generally the first to pull out of the market, as seen in 2023, as well as the first to reenter, which we are seeing signs of now,' Realtor.com senior economic research analyst Hannah Jones said.

Missouri is the hottest market for investors with three cities -including St. Louis (pictured) - ranking in the top five for the highest share of investor purchases

'More buyers may be choosing to invest in affordable markets that need more rental inventory in order to secure a steady stream of rental income.' 

Rounding out the top five are investors making 18.7 percent of purchases in Birmingham, Alabama and 18.2 percent in Memphis, Tennessee. 

Small investors made-up the highest share of purchases since the company started tracking them with 62.2 percent of investor purchases from January to March 2024.

Americans are attracted with the Midwest because of its relatively affordable properties, especially as house prices elsewhere in the U.S. skyrocket.

The Midwest is also less vulnerable to natural disasters with surveys showing that wildfires, tornadoes, floods and hurricanes are all growing concerns for home-buyers.

The median listing price in Springfield is $280,000, in Kansas City it is $285,000 and in St. Louis it is $207,500 according to Realtor.com.

In Kansas City (pictured), 20.1 percent of homes purchased in the first quarter of 2024 were by investors

Rent in the Midwest have increased due to the strong labor markets and increased demand that make purchasing homes in these areas desirable for investors.

A 2023 study by Mid-America Regional Council found that of Kansas City's 157,000 single-family rentals, nearly 20 percent are owned by people or companies with 10 or more properties.

Thirty-three companies own nearly 14,000 homes in the Kansas City region, five of which own nearly 8,000 homes. 

'[Investors are] intentionally targeting what has primarily been housing intended for ownership to turn it into rentals,' Josh Akers, research manager for the Mid-America Regional Council told The Beacon.