I'm not differentiating. The point I'm making is that investors, in whatever form, typically do cash transactions, where your traditional home buyers need a mortgage. That's a big factor in closing the deal. As a seller, if you have two equal offers on the table, one cash and the other pending appraisal, loan approval, inspections, etc, which one are you going to take?? That in itself drives up prices, because a family that really wants a home is inclined to offer above market just to be considered. Not sure how rising rates will affect that dynamic.
Reading that article brings up some other points in my mind.
- Millennials entering the home buying market should continue to support price increases.
- But what happens if the market dips and investors get spooked? Will they dump the houses in order to meet margin calls, causing a oversupply and depressing the market even further?