Residential communities in several states are adopting rental restrictions for new residents to slow the pace of investor purchases, a trend quickly generating controversy among rental home companies, The Washington Post reports. The share of single-family homes owned by investors is growing in majority-Black neighborhoods, and many first-time buyers are being priced out as a result. In some cases, homes are being rented to tenants who have not been properly screened, leading to increased reports of illegal drugs and gunfire.
Despite pushback from homeowners associations, rental firms argue that restrictions exacerbate an existing affordability crisis and open a doorway to housing discrimination. Though investor purchases are slowing, nearly 1 in 7 homes sold in the nation’s top metropolitan areas in 2021 were purchased by investors, the most in two decades.
Faced with this surge of corporate landlords, many homeowners associations have begun to fight back.
At the Reserve at Back Creek, a subdivision of 39 houses near UNC-Charlotte, neighbors last year adopted a rule requiring an owner to live in a house for a year before renting it out. No more than 18 percent of the houses can be approved for rental at any time.