Report: Investors target Atlanta’s Black neighborhoods, turn houses into rentals
Data shows that institutional investors are more likely to own houses in the areas most severely affected by the crisis-era foreclosures, which disproportionately harmed communities of color.
Institutional investors who purchase houses for rent have set their sights heavily on metro Atlanta, specifically targeting communities with a high concentration of Black people.
Compared to neighborhoods with a majority of white residents, Wall Street landlords are more than twice as likely to purchase homes in African American communities, according to an investigation from The Atlanta Journal-Constitution.
Experts claim that large investment corporations have snatched up so many homes in Atlanta’s southern suburbs that they have inflated sales prices and had a disproportionate influence in the rental market, giving them significant authority to raise rents.
“Once you start changing the dynamics in terms of where people get to live,” said Atlanta Regional Commission Community Development Division Manager Samyukth Shenbaga, the AJC reported, “it has an impact not just on that individual but generations down the line in terms of their health, their education, their jobs and also their general ability to generate wealth.”
Henry County Commission Chair Carlotta Harrell put her house up for sale in 2021 and received many cash-buying offers. However, she refused investors’ offers, she said, selling it to a family instead.
Real estate broker Oriana Wyche, who purchased Harrell’s home, claimed she had been looking for a bigger house for her expanding family of five for months. During her quest, she made 11 bids, and never anticipated having such a difficult time finding a new home.
She received a similar response for those rejected offers, though: “A lot of them told me it went to an investor who could close sooner, who could put more money down,” Wyche shared. “You just couldn’t compete.”
The AJC looked at acquisitions in the region made by bulk buyers, defined by the news outlet as owners of more than 50 homes. Since 2012, these investment companies have acquired more than 65,000 single-family houses throughout 11 counties.
Since just 2021, investors have purchased at least 50 properties in four out of five census tracts with a majority-minority population. Approximately 45% of those communities had over 90% minority residents. Bulk house buyers own a majority of houses in some neighborhoods.
In metro Atlanta, homeownership rates fell by 1.4 percentage points between 2007 and 2016, per a landmark study from Georgia Tech. The research discovered that during the same period, while white homeownership remained unaltered, Black homeownership fell by 4.2 percentage points.
Data from The AJC shows that institutional investors are also far more likely to own houses in the areas most severely affected by the crisis-era foreclosures over a decade ago, which disproportionately harmed communities of color.
Following the Great Recession, Wall Street snatched up hundreds of lots and foreclosed homes. According to supporters of the sector, their purchases helped to stabilize economically depressed neighborhoods. But once the economy recovered, businesses frequently sold their properties to additional investors.
DeKalb County Commissioner Lorraine Cochran-Johnson believes the racial difference is the product of years of housing policy dating back to redlining. Banks and mortgage companies engaged in this discriminatory practice by limiting where Black Americans could live and denying them access to house loans.
She noted that the flurry of investment activity has a comparable impact.
“Whether or not it is an intentional redlining that’s occurring, it is disproportionately affecting Black and brown communities,” Cochran-Johnson said. “There’s just no denying it.”
TheGrio is FREE on your TV via Apple TV, Amazon Fire, Roku and Android TV. Also, please download theGrio mobile apps today!
More About:News
You Might Like
