Investors ramped up their purchases of single-family homes last year to a level not seen since 2007 — and only half of those buyers financed the purchase. Almost half (49%) paid cash, according to a new report from the National Association of Realtors (NAR).

Investors purchased 1.2 million homes in 2011, up nearly 65% from the prior year. The 1.2 million figure represents 27% of all new and existing home sales that occurred last year.

“Nearly half of all investment home purchases in 2011 were distressed homes,” the Realtors said in a statement. “It shows the market for the large part is able to absorb foreclosures hitting the market.”

But NAR officials are concerned a government program to sell GSE REO in bulk to institutional investors will unnecessarily crowd out local investors and take business away from Realtors. Any government program should be “limited to small geographic areas,” NAR chief economist Lawrence Yun said. “Even where alternatives are needed, it's best to rely on the expertise of local businesses, nonprofit organizations and government,” he added.

For investors relying on financing, the median downpayment was 27% — the same as vacation home buyers.

The median price of an investor property was $100,000 in 2011, up 6% from the previous year.

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