The Minneapolis Fed posted a thoughtful article about investor owned properties across the Twin Cities metro. Investor-owned homes ebb and flow in the Minneapolis-St. Paul region. The long and the short of it is that investor owned homes represents a small percent of the total housing stock. Prior to the recession it amounted to 1.9% of homes and has been stable at 3.3-3.4% for the past eight years.
It’s funny how the story changes. The recession of 2009 pushed so many homeowners out of their properties that vacant and abandoned properties were an issue. Cities aggressively tracked down banks (for they were holding most of the paper through foreclosures) to enforce newly created vacant property rules. Investors bought homes that no one else wanted or was maintaining.
Some people infer a nefarious angle to the larger percentage of investor-owned rentals in low-income areas. Isn’t it logical that when people cannot afford to buy a home they partner with an investor so they may still enjoy the benefits of single-family living? Also- people who are new to an area often rent until they find their way around a new city.
The portion of rentals in a neighborhood is a number to keep an eye on, but there are many others. What type of household formations are accommodated in the neighborhood? Are there enough extra hours for the residents to participate in civic activities? Are transportation options safe and provide the proper connections? The performance of core services affects the quality of a neighborhood to a greater degree than the percentage of investor owners.
Home Economics 