In 2021, real estate investors bought nearly one in every seven homes sold across the U.S., the most in two decades, The Washington Post reports. Increased investment activity comes in the wake of record high consumer demand and escalating prices in a market now leaving many would-be buyers stuck on the sidelines. Investors logged their most aggressive period for home buying in the final three months of 2021, purchasing 15% of all homes sold in 40 major U.S. metros.
Black neighborhoods have been disproportionately targeted by large investment corporations, local companies, and even wealthy individuals looking to turn a profit on undervalued or lower priced homes. In the last year, investors closed on 30% of all home sales in majority Black neighborhoods, compared with 12% in predominantly white regional markets.
The effect of investor activity differs city to city. Regions with the highest share of investor purchases are in the south, stretching from Florida to Arizona, with a quarter of all home sales in Atlanta and Charlotte last year going to investors. But some of the most targeted Zip codes overall are in the Rust Belt, especially heavily minority neighborhoods in Detroit and Cleveland.
The growing number of investor purchases has drawn increasing scrutiny from Democratic lawmakers on Capitol Hill, particularly as buyers target minority neighborhoods.
“One of the reasons housing prices have gotten so out of control, is that corporate America sensed an opportunity,” said Sen. Sherrod Brown (D-Ohio) last week at a hearing of the Senate Committee on Banking, Housing and Urban Affairs, a panel he chairs.
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