Institutional rental housing purchases ‘serious problem’: COJ report

jacksonville, florida – News4Jax I-TEAM is Continue to delve into the role of institutional investors in the Jacksonville real estate market.

These are companies with more than 1,000 homes nationwide in their portfolios.

I-TEAM found over 9,600 homes owned by such investors throughout Duval County. Their real estate investments create wealth for their clients, not local families.

A December report commissioned by the Jacksonville City Council found that the trend has led to higher rents and fewer homes available to homebuyers for the first time.

The Critical Quality of Life Report was commissioned to act as a guide for city hall candidates who would soon lead the city of Jacksonville.

Related: Why Big Investment Company Rentals Are Blamed for Jacksonville’s Affordable Housing Problem

Institutional investors are having a “serious problem” in Jacksonville. Private equity firms and institutional investors buy and build rental properties in Jacksonville, incorporating homes and apartments into portfolios for wealthy investors. University of North Florida sociology professor David Jaffee calls this trend the “financialization of human shelters.”

“If shareholder value is the main driver driving the housing market, there is no prospect of affordable housing,” said David Jaffee, UNF Sociology Professor.

Jaffee co-chaired the Affordable Housing Commission last year for Jacksonville’s “Quality of Life That Matters” report. The conference will be held from October 2022. City Councilman Jucoby Pittman served as co-chair of the committee. She says her mother worked two jobs to make ends meet and grew up in affordable housing.

“And it still exists. Some of the problems that happened 20 years ago are still happening today.”

Data from the Northeast Florida Association of Realtors tracks home affordability (index scores above 100), much like Duval County did for single-family homes in April 2019. This means that median-income households have incomes in excess of mortgage eligibility. in a mid-priced home.

But after the rate hike, as of last month, the home affordability score had fallen nearly 40%, indicating homeownership had become obsolete due to higher house prices and higher interest rates.

The CEO of the National Rental Housing Council told I-TEAM that a shortage of housing supply as people migrate to Jacksonville has led to rising housing costs. He also said that interest rates are currently high, making renting an attractive option for families.

“I think we should do everything we can to encourage and encourage more housing, more housing creation, supply and further development,” said David Howard.

A city report said in December that there was a supply gap of 12,000 units.

“The key, from my perspective, is to provide affordable housing, rather than simply thinking that building a house in the wrong place will automatically solve the problem.”

His research found that investor-owned homes were at higher risk of eviction.

Mayor-elect Donna Deegan has vowed to work on what she calls “the”.affordable housing crisis” said the city, making unused city real estate available in stock, demanding new developments, including some employee housing, updating zoning to support more multifamily housing, It said it needed to keep real estate in local hands and ensure adequate funding for affordable housing programs.