The investor purchases are the highest on record and nearly twice the levels before the 2008 housing crash. The investor interest poses a challenge for millennials and other first-time buyers who are increasingly looking to buy starter homes and are forced to compete with deep-pocketed cash buyers.

Purchases of single-family homes by investors are at an all-time high. Strong rental demand, technology that facilitates buying homes online and low interest rates that make other investments less appealing have fueled investor appetite. Investors purchased with cash one in five homes in the bottom third price range (typical first time buyer homes) in 2018, according to the CoreLogic analysis, up 5 percentage points from the 20-year average of less than 15%.

Investors are swooping in, offering all cash (above asking price), no contingency and small close windows so they can flip the home into single-family rentals.

So-called iBuyers, such as Opendoor, Zillow Offers and RedfinNow, which snap up homes in cash for a fee to help sellers avoid the hassle of putting their homes on the market, comprised less than 2% of investor purchases last year, according to CoreLogic.

The biggest markets for investor purchases in 2018 were Detroit, followed by Philadelphia and Memphis, Tenn., where home prices are still low enough for investors to profit by renting them out. Investors bought nearly half the starter homes in Philadelphia last year and about 40% of lower-priced homes in Detroit, according to CoreLogic.