Institutional investors could control 40% of US single-family rental housing by 2030, according to MetLife Investment Management. A group of lawmakers in Washington DC say Wall Street must exit the market.
“What we’re trying to say is private equity will never buy single-family homes,” said Rep. Ro Khanna, a Democrat representing California’s 17th congressional district. Khanna is Block the Wall Street Landlord Act of 2022“The outrageous thing is that your tax dollars are helping buy single-family homes on Wall Street,” he said in an interview with CNBC.
The single-family rental industry began with government support in the aftermath of the 2008 financial crisis. “It was that rare opportunity that attracted institutions to build portfolios out of these foreclosed properties,” said Stephen Xiao, an assistant professor of financial and business economics at the University of Texas at Dallas.
Since the early 2010s, Tricon Residential, Progress Residential, American Homes 4 Rent, and Invitation Homes have each purchased thousands of homes.They also added to the housing supply in some cases A community built for rent.
Some of these companies are funded by private equity firms such as Blackstone and investment managers such as Pretium Partners.
“It’s almost a captive market,” said Jordan Ash, director of labor, employment and housing at the Private Equity Stakeholder Project. “They are very clear about how people are locked out of the homebuying market and become permanent renters.”
These calls came after heavy housing inflation hit many Sun Belt states, including Texas, Florida and Georgia. According to the National Association of Realtors.
Prices in some Sunbelt markets are outstripping national rent inflation, according to a study Zumper compiled for CNBC. Between January 2020 and January 2023, he said, rents for two-bed single-family homes have risen about 44% in Tampa, Florida, 43% in Phoenix, and 35% near Atlanta. This compares to a 24% increase nationwide.
Industry advocates argue that no market controls enough market share to determine pricing. A large institution said in early 2022 he owned about 5% of the 14 million single-family rental homes nationwide. according to analysts.
By 2030, financial institutions could own about 7.6 million homes, according to MetLife Investment Management’s 2022 forecast.
In the short term, however, some companies may exit the real estate market as fears of a correction grow. Blackstone Chief Operating Officer Jon Gray said: Interview with CNBC in December 2022.
look video See above to learn about the rise and future of corporate landlords in the United States.
https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html How Wall Street bought and rented single-family homes