The U.S. homeownership rate fell to 65 percent this year, its lowest level since 1995, according to Census Bureau data, as fewer people were able to qualify for a mortgage.
Institutional investors bought 24 percent of homes sold in the Atlanta region in the first half of this year, the most of any metro area, and up from 12 percent a year earlier, according to RealtyTrac, an Irvine, California-based data firm. The figure was 25 percent for July.
Prices Soaring
The buying spree has sent prices soaring and rents leveling off. U.S. home asking prices jumped 11 percent in July from a year earlier compared with a 3.9 percent increase in rents, according to San Francisco-based Trulia Inc. In Atlanta, asking prices rose 19 percent, while rents climbed 2 percent, the real estate information website reported.
With a glut of properties to fill, investors that shun some of the 2.2 million Americans with federal vouchers in certain regions risk higher vacancy rates and lower yields, according to Jeff Pintar, CEO of Pintar Investment Co., which has invested more than $1.5 billion in single-family properties.
“If you’re an investor in the markets that have Section 8 housing as a predominant portion of the community and you’re not accepting vouchers, you’ll have a bigger difficulty getting that property leased,” said Pintar, who manages more than 2,500 homes in Southern California, Las Vegas and Atlanta, with about 15 percent occupied by Section 8 tenants.
Finding Homes
As the number of investor-owned homes increases, Atlanta real estate agents such as Moore-Newsome say it’s been harder finding homes for voucher-holding clients.
“The majority of properties my clients are interested in are owned by these big companies,” Moore-Newsome said, adding that these tenants were already living in the neighborhoods investors have flooded, renting some of the same properties that were later purchased as foreclosures.
Moore-Newsome, who also represents market-rate renters and buyers, said she’s called Invitation Homes on a monthly basis since last year to inquire about its properties to rent. Last week -- after Bloomberg News asked Blackstone about its Section 8 policies -- was the first time the firm agreed to accept one of her applications for voucher holders, she said.