Homeownership has slipped out of reach for millions of Americans thanks to the astronomical rise in mortgage rates and an ongoing inventory shortage. Now, there is another obstacle to buying a home. Investors and hedge funds are snatching up properties at the fastest pace in nearly two years.

Although investors are scooping up fewer homes than they did before the pandemic began, they’re still purchasing a “fairly high” share of the homes. In fact, in the first three months of the year, investors bought almost 19% of homes that sold, the highest percentage in nearly two years. That means investors bought just about one in five homes for sale in the three-month period from January to March.

Investors are also more immune to high mortgage rates than the typical individual buyer because they tend to pay in all cash. They are drawn to lower-priced homes for many of the same reasons that individual buyers are. They cost less, which is appealing when both housing prices and borrowing costs remain elevated. This means that individuals are often competing with cash-rich investors to buy the same homes. There’s a mix of first-time homebuyers, investors and second-home buyers all fighting for homes. Any home that is entry-level is immediately pounced on leaving the first-time buyer with lower down payments at an huge disadvantage.