Cities seek limits as out-of-state investment firms gobble up homes

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9 thoughts on “Cities seek limits as out-of-state investment firms gobble up homes

  1. Those ideas all seem nice until you recognize they all tend to increase rent prices, and reduce what an individual non-corporate property owner can do with their property.

    No talk of a moratorium on allowing corporate entities to purchase or rent homes? Or are we just gonna ignore the actual problem?

  2. Even small landlords get (good sound) legal advice to buy and hold rental properties in some kind of corporate entity as a liability shield.

    So it would be important to distinguish between a corporate entity that owns 1-10 units and one that owns 100 or more. But nothing will prevent a corporate owner from putting the minimum number in dozens of LLCs, so limits can easily be defeated.

    And just defining a “small” or “de minimus” number of properties will be very tricky. Is that magic number 5? 25? 125? Or is it a question of total property assessed value? $500K? $1 million? $5 million?

  3. The representatives sponsoring Senate Bill 232 seem to be concerned about the economic impact on sellers. Are they ready to make up the difference between what a corporate entity would pay vs. what their preferred entity would pay? I guess it all depends on how close you are to selling, but if a seller, say a retiree, gets significantly less for their property because of such laws, it would seem lawsuits would ensue. I also wonder if the State Senators mentioned would be willing to commit to when the times comes selling their own personal real estate holdings to the “a referred entity lowest bidder.

  4. Maybe classifying the corporate owned rentals at the 3% property tax level just like the business rate, since they are owned businesses. Sure the rents will increase, but just maybe the higher rent prices will leave many vacancies, and putting the units back on the market, or not.

  5. Long needed. Anyone remember the Mt. Helix disaster? Out of state mega-investor that bought thousands of properties, let them run down, and destroyed whole neighborhoods. I’d love to see a kibosh on out-of-state investors altogether.

  6. It’s interesting that the common tactic seems to be putting a percentage cap on the number of investor owned homes. Our HOA recently amended its covenants and rather than limit the number of homes that investors can purchase, it prohibits any purchaser from renting their property for the first three years of ownership (yes, there are hardship and other exceptions such as being deployed by the military, being moved temporarily for work and renting to a family member). Also, rental agreements must be for a minimum of one year and for the entire property – no subletting. The research done by the HOA indicates that investors don’t want to wait for three years before trying to turn a profit on their investment so this was the best way to discourage that.

  7. Out-of-state investors do nothing less than harass homeowners. They have acquired my landline phone number, my cell phone number(as many as 30 per day), and, of course, my address. I get calls on holidays, as late in the evening as 9 p.m., and early mornings as 7 a.m. Something needs to be done to stop this madness.I will never sell.

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