according to Statement from the Mayor of Newark, Baraka. “In Newark, where we have worked hard for years to expand home ownership, we will do everything possible to combat this dangerous trend.
The launch of Newark’s response was a A report from the Rutgers Center for Law, Inequality and Urban Justice Which indicated that “nearly half of all residential purchases of 1-4 parcels were purchased by owners of LLCs.”
Anyone at CRE understands that the LLC is not necessarily the same as the institutional investor, but when it comes to general sentiment, that may not matter. Although the report acknowledges, in depth of text, that an LLC is not necessarily owned by a corporation, the city quotes the report’s author, Rutgers law professor David Trout, as saying, “Our report shows that the national trend of investors buying unit condominiums To four units in predominantly black neighborhoods is acute in Newark where nearly half of property sales have been made by institutional buyers.”
there 6.8 million single family homes deficit and The acute shortage of rental housing at every price point. In the third quarter of 2021, Redfin reported that Investors bought 18% of US homes that have been sold, although housing does not pass quickly from one hand to another like many other assets and there are questions about whether. The National Association of Home Builders Quotes Numbers Which indicates that the total of homes owned by large corporations is less than 1.5%.
However, in a housing crisis like the United States, anticipating the nuances of public debate may be wishful thinking and much of the public may not listen to what people in the industry feel is a cause.
For years, even conservative publications such as New York Post You have Books About Institutional Investors Sniping Homes. last year, a CNN The headline said, “Wall Street is buying up family homes. Rent checks are too tough to ignore.” In March 2022, The New York Times He published a story entitled “Investors are buying mobile home gardens. Residents are paying the price.”
The issues aren’t just bad journalism. Last year, Los Angeles considered a proposal to prevent tech companies and private equity firms from buying affordable family homes as investments.
Perhaps moving more toward construction to rent could make a difference, as it would add to the supply of rent without subtracting it from a potential home purchase. However, larger investors in SFR and BTR and smaller apartment buildings must be cognizant of public sentiment lest they find themselves under the thumb of general legal constraints.