December 8, 2022
New Bill Seeks To Limit How Many Houses Investors and Hedge Funds Can Purchase
Wall Street investors have been buying up homes in the Atlanta area at an increasing rate over the last few years, but a new bill in Washington seeks to block those sales.
According to WSB-TV, 30% of recent home sales in Atlanta have been to an investor. Other states including Pennsylvania and New Jersey have been dealing with the same situation. In response, Sen. Jeff Merkley (D-OR) introduced the End Hedge Fund Control of America Homes Act that would limit investors to 100 single-family homes.
“We can’t tackle giant financial companies buying up all our housing stock,” Westmoreland said. “That has to be done at the state, really at the federal level.”
Merkley added that the bill won’t pass Congress this year, but he’s planning to re-introduce the legislation next month. Atlanta city councilmember Matt Westmoreland said Atlanta has been crushed by the influx of investors buying homes.
“As you look over the last several years, literally no other city has been the victim of this type of activity more than Atlanta,” Westmoreland told WSB-TV.
Investors, seeing a chance to make money in the real estate market, have been purchasing homes and trailer parks, then jacking up rents and pushing longtime residents out.
According to Redfin, investors made 17% of home purchases in Atlanta during the third quarter of this year, totaling more than $2 billion. However, that’s a 42% decline in home purchases made by investors in 2021, largely due to a cooling housing market.
“That’s a huge decline, but as a share, they are still buying one in four homes,” Redfin’s Taylor Marr said. “It’s down from their peak where they were purchasing one in three.”
However, supporters of investors say they’re simply following market trends.
“Private equity firms or other large investors driven by a profit margin are not responsible for the price increase in the U.S. housing market,” a member of Congress said in a hearing according to WSB.
Powerhouse real estate broker and designer Egypt Sherrod, star of the HGTV breakout hit series Married to Real Estate, brought attention to this matter on her Instagram, saying in part:
“Let’s burn this one up on the timeline! A new bill proposes to limit the number of homes Wall Street investors can buy. This is in the wake of Chase bank announcing plans to spend 1 Billion on Atlanta Residential Real Estate. ”
View this post on Instagram