The American dream of home ownership is becoming more expensive for residents in the metro Atlanta area. Several factors have created issues for first-time buyers in the real estate market.
Rising interest rates and a lack of available housing has caused a crisis as the salary needed to afford a home increased from $59,000 in 2020, to $115,000 in 2024.
Corporate entities have created havoc by buying thousands of homes, mostly in majority-Black communities. Three companies (Invitation Homes, Pretium Partners and Amherst Holdings) own 19,000 homes in Atlanta. The corporate purchases have had a ripple effect.
A new study by Georgia Tech revealed that Atlanta residents lost $1.25 billion in home equity overall, with Black residents losing $681 million. Neighborhoods such as Kingswood, Grant Park, and Adair Park/Pittsburgh suffered the most, lossing $35M to $44M over a 10-year span.
“Atlanta lost $1.25B in financial equity between 2011 and 2021 with predominantly African American neighborhoods bearing more than half of the total loss. The most affected neighborhood suffered a loss proportional to nearly 4% of their total household income,” the study states.
The study continues to point out how Wall Street-backed corporations have added to the racial disparities in home ownership.
“Wall street-backed investors’ growing control of single–family rental (SFR) homes only widens existing racial gaps in homeownership and wealth. Forinstance, recent research investigating metro Atlanta shows that large corporate investors intensively targeted majority-Black neighborhoods with strong rental market potential shrinking Black families’ homeownership
rates. Similar findings are also observed in other metro areas. Furthermore, evidence illustrates that, compared with publicly traded real estate investment trusts (REITs), private equity firms tend to concentrate their SFR holdings in relatively lower-opportunity neighborhoods with larger shares of Black residents nationwide,” the study states.
Congress members have attempted to address the issue with “Stop Wall Street Landlords Act of 2022” and S.3402 “End Hedge FundControl of American Homes Act.”
However, the study states that those bills, “fail to account for small and medium-sized corporate investors who may have a non-negligible ownership concentration in certain neighborhoods.”
The overall impact reveals that majority-Black neighborhoods lost assets equivalent to 1.6% of their income during the study period, whereas other neighborhoods lost about 0.4.
The study suggests that lawmakers would need to be more aggressive in implementing laws to protect communities and place limitations on corporate investors.
“Policymakers could come up with a more comprehensive framework that considers cumulative impacts wrought by corporate investors. With an adequate framework to quantify such financial equity loss and comprehensive data often publicly available, planners and analysts can seek to measure the financial impacts for their local jurisdictions to inform,” the study states.
About Post Author
A.R. Shaw serves as Executive Editor of Atlanta Daily World. His work has been featured in The Guardian, ABC News, NBC, BBC, CBC. He’s also the author of the book “Trap History: Atlanta Culture and the Global Impact of Trap Music.”
