How corporate investors are taking over neighborhoods
The calls, texts and letters started about two years ago. St. Petersburg resident Tamika Morris has a pile of junk mailers just inside her front door and dozens of numbers blocked on her phone.
The messages are always the same. Companies, with names like “HomeInc” and “HomeVestors,” offer to pay cash “as is” for her Greater Pinellas Point home. No real estate agents need be involved.
Morris said the callers never say whom they represent but often ask her to name her price. Even her son, who’s name is not on the deed, gets calls from entities trying to buy her house.
“There’s no amount of money for me to be able to give up land,” said Morris, who bought her modest three-bedroom home in 2004 for $157,400. “Land is important in the history of our family. Having something to call our own is important.”
But the barrage of messages keeps coming — a common strategy for the real estate investment companies buying thousands of single-family homes in Tampa Bay’s already competitive housing market.
Housing in Tampa Bay is becoming increasingly corporate-owned, a Tampa Bay Times analysis has found. Large companies have amassed around 27,000 homes across three counties. More than 70% of these properties are linked to institutional investors backed by Wall Street and private equity.
The companies have fueled a growing single-family rental market, which proponents say creates more options for those who can’t afford to buy.
But while investors are not to blame for the region’s inflated rental and home prices, experts say they exacerbate the issue with tactics that shut out individual buyers. Disproportionate concentration of ownership among a handful of companies has been linked to rising rent and sales costs as well as neglected property maintenance and higher eviction rates.
“They drive up the prices and lower the (housing) supply,” said Lei Wedge, a professor of finance at the University of South Florida Muma College of Business. “They’re affecting people’s every
day life now.”
Families like Morris’ are caught in the crosshairs. In such a costly and competitive market, she fears her three children may not get the same opportunity for homeownership.
“I am very thankful that I don’t have to look for a home at these prices right now,” Morris said. “I don’t know how anybody can make it.”
The rise of single-family rentals
Investment firms started buying single-family homes during the Great Recession, when the market was flooded with foreclosed homes and the need for rentals shot up.
Kendall Bonner, a Tampabased real estate broker, said at that time she believed the companies would sell the homes once the market recovered.
“But we’re now … more than a decade later, and those properties have not been released en masse or at all,” Bonner said. “Which I think is somewhat contributing to our current inventory problem.”
The Times analyzed property appraisal data to find every single-family home purchased or owned by a company with 50 or more houses in Pinellas, Pasco or Hillsborough counties. Potentially thousands more homes are owned by smaller corporations that didn’t meet the 50-property threshold.
Some of the owners the Times identified are local entrepreneurs with holdings in both residential and commercial real estate. Many are construction companies building new homes. But the region’s largest landlords are investment firms based in Arizona, Illinois, Texas and elsewhere.
A few companies own more than 1,000 homes each. Invitation Homes, a Dallas company that until 2019 was owned by the private equity firm Blackstone, has nearly 6,000. It is the region’s largest homeowner.
It’s not uncommon to see entire blocks bought up by corporate owners. Take Spring Snowflake Avenue in Tampa. Nestled inside a massive subdivision built by the construction company Lennar Homes, all the houses on the street were listed for sale by 2022. Though a few eventually sold to individuals, at least 56 of the 71 homes were scooped up by Progress Residential, one of the region’s fastest-growing landlords.
Most of the homes were originally listed at around $400,000. Property records show Progress paid an average of $375,918 for each one.
Growing corporate influence
Tracking these companies across the region can be tricky. Most employ dozens of related companies that conceal a property’s parent company. For example, the Times found nearly 100 LLCs linked to Progress Residential. Most of the LLCs — many with nondescript names like “Home SFR Borrower IV LLC” and “True North Property Owner B LLC” — had a common mailing address: the company’s P.O. Box in Scottsdale, Arizona.
“The power imbalance through this obfuscation of ownership really makes it difficult for cities and community members to even have a sense of what’s going on,” said Benjamin Pries, a research fellow at Drexel University who studies the impact of institutional investors. “The outcome is we don’t know who owns these rental properties, so we can’t really address any of the problems that come about from them.”
Sales records show a spike in corporate purchases during the COVID-19 pandemic, as companies sought to profit from mass migration to the Sun Belt. In 2021, at least 5% of home sales in Hillsborough and Pinellas counties were individuals or smaller entities selling to large corporations — compared to 1.5% the year prior.
More than four dozen companies purchased around 2,200 homes.
Buying slowed for most investors in the last year as interest rates rose, and individuals and smaller companies still control the vast majority of the 800,000 or so homes in the region. But in total, large companies have more than doubled their share of single-family parcels in the last decade, while prices have boomed.
Companies haven’t sold their stock nearly as fast as they bought it, property data shows, instead operating thousands of rental homes throughout the region. When they do sell, it’s often to other corporate entities, or to one of their own LLCs, which critics say keeps homes out of reach for individual buyers.
“Once a corporate landlord buys a home, it’s pretty much off the market for good,” said Jordan Ash, director of Housing at the Private Equity Stakeholder Project, a nonprofit watchdog of the private equity industry.
The National Rental Home Council, a trade group representing some of the biggest players in the single-family rental industry, contends its members play a crucial role amid growing demand.
“What we’ve seen in Tampa is what we’ve seen in other high-growth markets — places like Atlanta, Nashville, some of the Texas markets,” said David Howard, the group’s CEO. “These are markets that have been characterized by robust levels of in-migration, population growth. … All of this pushes the demand for rental housing.”
Investment companies have risen to the occasion, Howard said, providing rental opportunities in both existing homes and new builds.
Proponents also emphasize that major investors are not the express cause of high housing costs. On the contrary, they say, more single-family rentals offer options to tenants who can’t afford to buy a house.
“We cannot demonize institutions for facilitating this supply of quality housing that otherwise would be out of the realm of possibility for many Americans due to the economic consequences of inflation,” U.S. Rep. Tom Emmer R-Minn., said in a 2022 hearing of the House Committee on Financial Services.
Fallout for buyers and renters
Still, numerous reports in metro areas across the country have questioned the companies’ concentration of ownership, their effects on the housing market and their methods as landlords.
A greater presence of corporate and investment landlords can lead to a shutout of traditional buyers, studies show. Backed by reserves of cash, companies can make offers far above asking price, often bypassing inspections, according to real estate experts interviewed by the Times. The companies have access to algorithms that identify and make offers on properties much faster than individuals can — in some cases before a home is even listed, and for numerous homes at a time.
The flurry of purchasing in recent years was especially clustered in areas with more residential construction, like Riverview
and Brandon, or in places with climbing property values, like the historically Black neighborhoods of South St. Petersburg. These are areas where, experts say, companies are most likely to profit.
Since 2018, companies have bought more homes in Census tracts with median household incomes below county averages. They’ve also purchased at a faster clip in majority-Black neighborhoods, which community residents say have further elevated the already-inflated housing costs.
The Times found that Amherst Residential, an investment company backed by the Koch brothers, bought nearly 450 homes from individual homeowners in Pinellas County between 2018 and 2022. More than a quarter of those transactions were in the South St. Petersburg Community Redevelopment Area, a section once dominated by Black households where property was passed through generations. Property records show Amherst still owns more than 100 homes in the area.
Karla Correa, an organizer with the St. Petersburg Tenants Union, said she believes these companies are part of the problem, not the solution. She knows of dozens of homeowners receiving a deluge of phone calls from investors hoping to acquire more homes.
“It’s really uprooting people from their communities,” she said. “Whatever these corporations are giving them for (their homes), it’s not worth it.”
City officials in St. Petersburg have also studied investors’ buying activities, said City Council member Richie Floyd, and they’ve taken notice of their concentration in working-class neighborhoods. The potential effects on affordable housing are alarming, but from a policy standpoint, leaders have little control over who buys homes, he said.
Floyd, who often advocates for reforms to the private housing market, said the investors are “acting logically in an illogical market,” where the priority is to maximize profits.
“It’s not good, what they’re doing,” he said. “But they’re doing it because it’s set up this way.”