The hot housing market has more companies and corporations buying up single-family homes.
They're known as institutional buyers and they accounted for a little more than 13.2% percent of residential purchases last year according to new research from The National Association of Realtors. That's up from about 11.8% percent in 2020. These investors are making it more difficult for people to find affordable housing, but a new federal action could help prevent some of this in the future.
Claire Murphy is someone who has struggled to find affordable housing. She has been living in a camper for two years in Frisco, Colorado.
“It's more than just not having a shower," Murphy said. "It's feeling unsafe, feeling unsettled.”
Her boss lets her live on the property where she works because she can’t afford to buy or rent a home.
“The rents are more than 50% of my wage, and that's just not feasible,” Murphy said.
While there are a lack of new properties being built across the country, Murphy says that’s not the issue in her area.
“On every corner, there are 20 apartments being built, but we'll never get to see them,” Murphy said.
The problem is she says investors are buying them up.
“So what chance do we have?” Murphy said.
The Biden Administration recently laid out some initiatives to battle the housing crisis. Among the list is 'ensuring that more government-owned housing and other housing goes to owners who will live in them, or nonprofits who will rehab them instead of large institutional investors'.
Matt Emery with the National Association of Realtors researches the impact of institutional investors.
“The institutional buyer is a buyer from Wall Street or a hedge fund or someone outside of the scope of a traditional buyer," Emery said. "These are not mom and pop investors. These are investors that are buying homes and communities on a large scale and looking to make profits from them, either from turning them into short- or long-term rentals or buying homes and flipping them.”
Emery says these investors tend to focus on certain regions. Often they're places where many people are moving and where rents are growing fast so they can get the biggest return on their investment.
“We're sort of seeing a concentration of them going in the southeast," Emery said. "You know, a lot of states down there, Florida, Georgia. But Texas is actually the one that they're most targeting right now. The other states are Ohio and Utah.”
However, he says institutional investors buying up properties is only a small part of the housing crisis. For change to happen, Emery says the recommendations from the White House have to move through Congress.
"We're going to need some of these big swings to fix the issues because I don't think the market's going to correct these on their own,” Emery said.
In the meantime, Murphy says she isn’t giving up on finding an affordable place to call home.
“We don't stop looking," Murphy said. "We keep looking. And we just hope that as the weather changes and as the season changes, something will come up.”