Homeowner Groups Rallying Support to Keep Renters Out

Some homeowner associations are wielding their power beyond lawn maintenance and paint color to prevent investors from buying up homes for the sole purpose of renting them out, The Wall Street Journal reported Monday (April 18). 

Rentals not only lead to a decline in the overall upkeep of properties, some associations maintain, but rentals can also make neighborhoods less desirable while making it harder for families to buy. More than one in five home sales in December were investor purchases, according to housing research firm CoreLogic. 

Some of the ways homeowner groups are trying to stop this practice is by capping the number of rental properties allowable in any given neighborhood or mandating that rental tenants get approved by the association. 

“They’re coming in, and they’re basically bullying people out with cash offers,” said Chase Berrier, president of the Whitehall Village Master Homeowners Association in Walkertown, North Carolina.

Berrier is leading the effort to amend the association’s bylaws that would make it mandatory for new buyers to live in a home or leave it vacant for six months before renting it. Per the report, the association believes this would stop investors from purchasing properties as rental units. 

Read more: FinTechs, Issuers Rally to Ease Rental Housing Crunch

Investors’ effect on the housing market and local neighborhoods has become a nationwide issue that is fast becoming a talking point in many circles as home prices continue to reach monumental highs. Families looking to buy a home have said it’s hard to compete with companies that pay in cash.

On the flip side, housing analysts have said that keeping investors out could hurt renters already struggling to find suitable places to live.

“There’s a pretty deep and pervasive social stigma against renters,” Jenny Schuetz, a senior fellow at the Brookings Institution, told the WSJ.

See also: Robotic ‘Factory in the Field’ System Lends a Hand to Labor-Strapped Builders