Out-of-state investors complicating home-buying process in markets like Kansas City

Realtors say many out-of-state investors from major cities like New York and Los Angeles are...
Realtors say many out-of-state investors from major cities like New York and Los Angeles are seeing homes in their areas going for millions of dollars.
Published: Mar. 28, 2022 at 5:47 PM CDT
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JOHNSON COUNTY, Ks. (KCTV) -- People looking for a new home in the Kansas City metro are running into a new obstacle that’s driving the price of some homes out of reach.

“A lot of times once you find a property it’s maybe already gone or gotten offers but the process looks like multiple offers going over asking price,” says Desiree Lee who recently bought a home.

Lee has been searching for a new home for several months and has even seen homes going for more than $100,000 over the asking price.

That’s because realtors say many out-of-state investors from major cities like New York and Los Angeles are seeing homes in their areas going for millions and millions of dollars.

Meanwhile, they’ll look at homes in a growing market like the KC metro, for say $500,000, so they immediately start bidding on these homes.

They are bidding way over the asking price to ensure they get the home, whether for their own personal use or to then rent out for additional income.

“You are dealing with investors who are coming in with unlimited money, and they are not worried about appraisals, they are not worried about inspections. They wave everything and they are bidding higher, and a lot of buyers can’t necessarily compete with that,” says Erich Goldstein, associate broker for Better Homes and Gardens Real Estate.

This move has led to regular people just looking for a home to either pay larger amounts of money to compete or keep searching.

In Lee’s case, she finally was able to get one and expects to close on it in over a week.

Lee says it’s a frustrating process but it’s all about not giving up.

“Just keep looking and just a little bit of patience and determination and you’ll be able to find a place,” says Lee.

Officials say another key is to have a good real estate team by your side.