By Elliott Brack
Editor and Publisher, GwinnettForum
DEC. 13, 2024 | It is a disturbing fact that emerged recently. Private corporations own more than 51,000 single-family rental homes in Georgia.
Gwinnett leads all of Georgia when it comes to corporate-owned rental houses, totaling 9,680. The closest to it is in Henry County, where corporations own 5,761 corporate-owned rentals, followed by Cobb County with 5,284 and Fulton County, with 4,150 houses owned by corporations.
That is not the position Gwinnett County and the state of Georgia needs to encourage.
What is most troubling about this is that those families who live in these 51,000 homes are paying rent each month-after-month for no long-range benefit. They are only paying for each month’s housing. They are also not building any equity in their homes. The act of paying off a mortgage on a home loan each month, rather than paying rent, accounts for the ways most families build generational wealth over the years.
It may seem like a 30 year mortgage) takes forever to pay off. But when you finish paying for it, your home, in 95 percent of the cases, is worth far more than you paid for it, even accounting for inflation. That’s the equity. It’s the way most people propel themselves to a better lifestyle.
So, by individual families paying monthly rental to these giant corporations, these renters allow these big owners to enjoy the growing equity in the residence, making these firms even bigger, but leaving out the family’s ability for a better lifestyle. The big corporate owners become fatter cats in this process.
Who are these corporations? Seven operating in Georgia are:
- Invitation Homes of Sandy Springs;
- AMH Homes, Las Vegas, Nev.;
- Tricon Residential of Toronto, Ontario, Canada;
- Home Partners of America, Chicago, Ill.;
- Progress Residential, Alpharetta;
- FirstKey Homes,(undetermined location via internet); and
- Amherst, with offices in Austin, Tex. and New York, N.Y.
One story said: “Metro Atlanta has become ground zero for an investor takeover of the American Dream.” In reality, it’s Gwinnett County that is ground zero for this preying on buying out single family houses and converting them into rental units. Investors bought one of every three homes for sale in Atlanta from July 2021 to June 2022.
What these corporate publicly traded companies do is to buy the homes, then convert into rental properties and bundle into complex investment vehicles.
A shortage in housing, going back to the recession of 2008-09, contributes to this. Since then, there have been long-term housing shortages, inflated construction costs and a surge in consumer demand. All have contributed to the historic rise in prices. It makes homeownership out of reach for many first-time buyers.
Meanwhile, all this has driven up rental prices. The average apartment renter now has to fork out $1,630 a month, according to Matt Elder, of Housing and Community Development for Gwinnett.
If you own a home locally, think back about some of the junk calls you have received. These callers seek to know if you are interested in selling your house for cash. These calls are uninvited, out of the blue.
One idea was that the callers represented overseas investors, looking to put their cash to work in the United States. Some suggested it was rich Chinese investors.
But now this looks like it could have been these giant corporations, employing telemarketers to find them homes to buy, and convert into rental housing.
Eliminating heavy corporate-owned rental housing is going to be difficult. We urge those with ideas on how to solve this problem to step forward.
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