Alderman warns of corporations buying up single-family residences

Letters+to+the+editor

To the editor:

What will happen to single-family homes in Green Park? Many are now rental properties. Are these rentals actually retirement investments by hard-working Green Park citizens living in the community? Since the 1940s, the residential housing market has experienced booms and busts that affected the rental market. During the evolution of single-family residential housing, corporate ownership developed and now dominates.

Today, ownership of single-family rental property is most likely to be a corporation, not mom-n-pop. Old wisdom dictates that increasing home values deters investment buyers. But corporate investors are not necessarily fixated on immediate profit. In general, there are two corporate investment strategies: 1) Purchase property at below market price, fix-up and maintain the property, and charge maximum rent. 2) Purchase residential property in a targeted geographic area, buy at or below market value, then rent the house at market price while allowing it to deteriorate. As the targeted area deteriorates, corporate investors buy-up the now devalued homes around them. At some point, the devalued area is blighted, redeveloped and a new community of expensive homes built. And great profit is reaped by corporate investors.

The City of Green Park has many desired amenities and is uniquely located in the residential and business heart of the South County community. And the mid-century homes in Green Park are ideal targets for corporate investors seeking to develop single-family rental properties. So, savvy investors continue to gobble-up Green Park homes. Resident property owners should be concerned.

Michael Broughton

Green Park

Editor’s note: Michael Broughton is the Green Park Ward 1 Alderman.