This mentioning of 'Wall Street' with investors if typical for the kind of populist argument that is used to argue that banning investors from buying houses is a good thing. What would this 'Wall Street' even mean? Would it mean that companies listed on the stock exchange are banned but privately owned companies not?

Anyhow, I argue that investors are positive for the the house market. They shouldn't be banned. Investors provide enough liquidity to the market so that the building companies have enough certainty to invest in large housing projects, because they know that their properties will be sold quickly. If investors would be banned they would sell their houses eventually as well but it would take much longer.

Similarly, investors improve mobility and throughput. An individual putting his house for sale will find a buyer much faster when investors are in the buying market, who are willing to buy up a house when nobody else takes it and sell it for a better price later. So: sellers sell faster, so they can move out and buy a new home faster as well: mobility in the house market increases.

In IT terms: investors function as a buffer.