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CAPE FEAR MEMORIAL BRIDGE CLOSURE: UPDATES, RESOURCES, AND CONTEXT

"Security for Sale": Raleigh N&O's Tyler Dukes on the corporate investor takeover of NC's housing market

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A new investigation from the Raleigh News & Observer details how investor corporations are disrupting the starter home market and the rental market in cities across North Carolina — including Wilmington.

The Raleigh News & Observer has recently published an in-depth investigation into investor landlords: large corporations that have taken over a quarter of the single-family rental market in certain North Carolina cities. WHQR’s Kelly Kenoyer interviewed Investigative Reporter Tyler Dukes about that story. This interview focuses largely on Part 1 of the series but Part 2 gets in-depth about how these companies behave as landlords, and Part 3 discusses what advocates and politicians may do about it.

This interview has been edited for clarity and brevity.

Kelly Kenoyer: Can you tell me how you got started on this story?

Tyler Dukes: Back in 2021, we were taking a look at real estate data. And we knew that the housing market was hot in places like Charlotte and Raleigh- we were specifically focused on Raleigh.

The question was, you know, who's buying up property? Who's making money during the pandemic, in particular? And so we started in a very simple way looking at who are the biggest property owners. And as we started that process, we started to see a lot of the names that we now sort of know very well sort of pop up to the top of that count. that's when we really started to see some of the patterns emerge.

KK: I did notice that Wilmington has a number of these properties as well. And when I dug into your maps, it looks like American Homes 4 Rent is the biggest one here. So is there anything that you could tell me about that company in particular?

TD: Yeah, American Homes 4 Rent is one of the largest of these single-family rental companies. So this company is both a property manager and a property owner. So if you are a tenant of American homes for rent, you're going to be renting your home directly from them paying your rent directly to them. One of the things that’s been interesting about American Homes 4 Rent specifically, is that they've gotten really into and have shifted their business model towards “build to rent”. So in addition to owning a pretty large portfolio of pre-existing houses, in a lot of places across North Carolina, what they're also doing in a lot of communities, is working directly with builders to actually build entire communities where they own all of those properties in the neighborhood and rent them out.

KK: What kind of impact does this have on the rental market? I mean, I found data showing that rents in our city went up on an average of $40, just between March and April of this year.

TD: It’s a complicated question, right? When you talk to experts who sort of look at this, you know, one of the things that they have at least noted anecdotally is that in certain places, once you get to a point where you are soaking up a good bit of the rental market, across maybe just a handful of companies, then you do get a lot more power to set prices. Now, one of the things that we aren't able to say, at least with the data, is that these companies are pushing rents up, they're causing them to rise across the board. But certainly a thing that we've noticed [among renters] is that every time they re-sign a lease with these companies, the rent goes up. Now, rents are rising in a lot of places, right. So one of the things we're hoping to do now that we have a good base count of where these companies exist, is try to answer some of these harder questions about what do the impacts look like on the ground, and especially in specific neighborhoods, where we're seeing a large chunk of the neighborhood sort of getting bought up by Wall Street.

KK: So how much of the rental market and the overall housing market do these companies account for now?

TD: It’s a great question. So you know, our count puts the number of single family rental homes owned by these companies- And we're talking about just over 20 companies- at 40,000 homes across the entire state of North Carolina. Now, the industry will point out, and rightly so, that that 40,000 homes is just a small percentage of the overall housing across North Carolina.

But one of the things that we're also doing with this data and this investigation is specifically looking at the types of houses and the types of neighborhoods that these companies are buying in. And when you look at those neighborhoods, in places like Charlotte, we're looking at a situation where these companies- just these 20 plus companies- own about 25%, of the single-family rental home market. And that's pretty significant.

When you look at it neighborhood by neighborhood, they are sort of traditional starter homes. The kind of house that a new family might purchase for the first time or you would buy after you get your first real job, you start your career. The sorts of starter home investments that a lot of people would have previously found accessible, when the market maybe wasn't so wild as it is now.

KK: Tyler Dukes, from the Raleigh News & Observer, thank you so much.

TD: Thank you for having me.

Kelly Kenoyer is an Oregonian transplant on the East Coast. She attended University of Oregon’s School of Journalism as an undergraduate, and later received a Master’s in Journalism from University of Missouri- Columbia. Contact her on Twitter @Kelly_Kenoyer or by email: KKenoyer@whqr.org.