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Paperstac’s 2024 End of Year Market Report

Get an in-depth look at the note investing market with Paperstac's 2024 End-of-Year Market Report. This report is based on anonymized trade data from hundreds of note closings on Paperstac.com, providing an analysis of the real estate notes selling and for how much on the Paperstac marketplace in 2024. Discover the latest trends and insights in the note investing industry.

Brett Burky

February 27, 20254 min read

Paperstac’s 2024

End-of-Year Market Report

Paperstac’s 2024 End-of-Year Market Report provides a comprehensive analysis of the note investing market. This report reveals valuable insights into the real estate notes sold and their prices on the Paperstac marketplace in 2024.

average investment to balance for Paperstac end of year market report

average sale price for Paperstac's end of year market report

Deal and Asset Overview

(what is selling and how deals are getting done)

performing vs non performing Paperstac End of Year Market Report

1st position vs 2nd position graph Paperstac End of Year Market Report

single assets vs pools graph Paperstac End of Year Market Report

Escrow vs Direct to Seller Payment graph Paperstac End of Year Market Report

Paperstac End of Year Market Report used an auditor to verify collateral graph

Paperstac 2024 end of year market report state statistics

Paperstac 2024 End-of-Year Market Report: Key Trends in Note Investing

Get an in-depth look at the note investing market with Paperstac’s 2024 End-of-Year Market Report. Based on anonymized trade data from hundreds of note closings on Paperstac.com, this report provides insights into real estate note pricing trends, investor behavior, and key market shifts in 2024.

Between 2023 and 2024, the Paperstac loan trading data revealed subtle but important shifts in key market metrics. While some categories saw little change, others indicated evolving market dynamics that could impact investors’ strategies moving forward.

Shifts in Investment-to-Balance (ITB) Ratios

One notable trend is the slight decrease in Investment-to-Balance (ITB) ratios for performing and non-performing loans in both 1st and 2nd lien positions.

Performing 1st position loans saw an ITB drop from 77.18% in 2023 to 76.58% in 2024, while non-performing 1st position loans increased from 62.72% to 63.95%.

The decline in performing ITB suggests investors are exercising slightly more caution, likely due to market uncertainties, interest rate fluctuations, or changes in borrower behavior. Meanwhile, the increase in non-performing ITB could indicate a higher willingness to pay slightly more for distressed assets, possibly due to improved recovery expectations or increased demand for workout opportunities.

Investment-to-Value (ITV) Ratios Remain Stable

The Investment-to-Value (ITV) ratios remained relatively stable but trended slightly downward in 2024 across most categories. The ITV for performing 1st position loans went from 35.96% to 35.83%, and for non-performing 1st position loans, it barely changed from 26.11% to 26.17%.

The minimal shifts suggest that valuation strategies remain consistent, with buyers carefully assessing the equity positions of assets before committing capital.

2024 End of Year Market Report Average Pricing Trends

When analyzing average pricing, performing 1st position loans saw a small increase in average trade price from $33,894 to $34,043, while non-performing 1st position loans rose from $24,648 to $25,020.

This trend suggests that buyers are willing to pay slightly more for assets despite market uncertainties, potentially driven by improved confidence in note performance or enhanced workout strategies.

However, non-performing 2nd position loans experienced a drop in average price from $11,990 to $11,581, which could indicate a reduced appetite for riskier junior liens or adjustments in pricing expectations.

Deal Volume Composition: Performing vs. Non-Performing Loans

In terms of deal volume composition, the split between performing and non-performing assets remained relatively stable, with performing assets making up 83.96% of trades in 2024 compared to 84.31% in 2023. The slight increase in non-performing sales suggests a modest rise in distressed inventory or investor willingness to acquire riskier assets. Meanwhile, 1st position loans continued to dominate, representing 89.08% of trades in 2024 versus 89.38% in 2023, signaling investors’ continued preference for senior lien positions.

Looking Ahead: Key Takeaways for 2025

Looking ahead, these shifts suggest a cautiously optimistic market, with investors maintaining a disciplined approach to pricing while demonstrating a willingness to pay slightly higher premiums for quality assets. As interest rates fluctuate and economic conditions evolve, we may see continued refinement in pricing strategies, with an increased focus on deal structuring and due diligence.

If interest rates stabilize or decline in 2025, performing notes may see even stronger demand, while distressed assets could become more attractive as investors anticipate improving recovery conditions.