“Robert Cayouette, a computer programmer, has put down deposits on 10 homes under construction in Florida, figuring he’d quickly flip them and make a profit of about $30,000 apiece. The first of those purchases, a three-bedroom home in Port St. Lucie, is expected to close this month. But Mr. Cayouette has learned he’ll be lucky if the house fetches $285,000, or $10,000 less than his original purchase price. “I wouldn’t be able to flip it if I wanted to,” says Mr. Cayouette.

With home prices growing faster than rental rates, investors who decide to rent out their properties rather than sell them often can’t make enough to cover mortgage payments, taxes and other costs. Arash Yazdi, an information technology consultant, decided to rent out his $465,000 townhouse in Merrifield, Va., this fall after a deal to sell the home fell through. He figures he’s losing about $1,000 a month.”

WSJ: Investors Retreat From Housing Market