Meet the Latest Housing-Crisis Scapegoat

The Future of Land and Housing Program's research on the housing market in Winston-Salem, North Carolina was cited in an Atlantic article on the U.S. housing crisis.

If there are no solid data supporting the institutional-investor-scapegoat story, there are certainly plenty of misleading statistics. Here’s one egregious example: A report from the House Financial Services Committee reads that “in the third quarter of 2021 alone, institutional investors bought 42.8% of homes for sale in the Atlanta metro area and 38.8% of homes in the Phoenix-Glendale-Scottsdale area.” These are unbelievably big numbers, and they are—literally unbelievable, that is. The citation provided in the document was not correct, but I was able to find the relevant report and, wouldn’t you know it, that’s not what it says. The report shows only the share of purchases made by investors, not institutional investors. Why does this matter? Because investors include people or entities who own fewer than 10 properties, midsize investors who own 10 to 99 homes, iBuyers—which buy properties and then immediately resell them—and even people who purchase vacation homes through an LLC. Relatedly, a New America report last year of investor activity in North Carolina suggests that investor growth in that market is actually being driven by smaller players.

To read more about large investor activity in Winston-Salem's housing market, see our research here.