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Lessons From Great Recession Wall Street Buying Spree
Wednesday, April 1, 2020
In an earlier
article, (before more pressing issues shelved the topic) we summarized
highlights from a recent New York Times Magazine article about the
ownership of a large share of the nation's single-family rental stock by
institutional investors. Part 1 recapped how private equity funds moved to
purchase distressed single-family homes during the housing crises, turning it
into rental stock. Their property management has been uneven, and tenants are
suffering from significant financial abuses. The author, Francesca Mari, who
tells much of the story through the eyes of Chad who is now renting the home he
used to own, says the extent of the financial repercussions from Wall Street's
investment are not limited to the rapid rent increases and unfettered fees we
pointed to in the first article. The institutional owners are not always
maintaining property, failing to make needed repairs, or making them as cheaply
as possible. Some of the neglect has begun to manifest itself in health issues
such as black mold induced allergies.
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