Last year, outside investors gobbled up houses in metropolitan areas across the country — including in Greater Cincinnati — at an alarming rate, The Washington Post found after analyzing data from real estate company Redfin.
According to the analysis, investors bought nearly one in seven homes sold in America’s top metro areas, the most in at least two decades. The analysis considers real estate investors to be large corporations, local companies, or wealthy individuals who generally don’t live in the properties they are buying, who either look to flip the homes to new buyers or rent them.
In Cincinnati, 15% of homes were purchased by investors, which is more than those purchased in a typical metro area, the Post found. In 2015, investors bought just 7% of the housing stock.
In November, CityBeat reported that Cincinnati was one of the most-booked cities on Airbnb, which analysts say also has contributed to the housing squeeze.
There also was an investor bump elsewhere in Ohio. Cleveland saw 16% of its homes purchased by investors, while Columbus had 14%. The shares for both cities were higher than in other metros, and both were increases over 2015 percentages.
“One of the reasons housing prices have gotten so out of control, is that corporate America sensed an opportunity,” Sen. Sherrod Brown, an Ohio Democrat, said last week at a hearing of the Senate Committee on Banking, Housing and Urban Affairs.
Brown added, “They bought up properties, they raised rents, they cut services, they priced out family home buyers, and they forced renters out of their homes.”
The buying spree comes at a time of escalating home prices, putting a squeeze on would-be homeowners, and exacerbating the racial inequality gap in generational wealth.
According to the Post‘s analysis, 30% of home sales in majority-Black neighborhoods were to investors, compared with 12% in other ZIP codes. In Detroit, which is more than 80% Black, 19% of homes purchased last year were bought by investors — more than the typical metro, and higher than its 2015 rate of 11%.
In Cincinnati, investors snapped up large numbers of houses in areas like the West End, Price Hill, Westwood, Avondale and Evanston — neighborhoods where high numbers of Black and Brown residents reside.
“There is a massive racial homeownership gap in this country, which is a serious problem because owning a home is a key to building intergenerational wealth and reducing racial inequality overall,” said Sen. Robert Menendez, a New Jersey Democrat, according to the Post.
Throughout much of 2021, local monthly rents — as in permanent housing, not vacation rentals — increased in year-over-year comparisons. In June, the overall median rent in Cincinnati was $1,200 per month, an increase of 17% over the previous year. Rents increased for Cincinnati studios, one-bedroom apartments and two-bedroom apartments in June, a report from Realtor.com says. At that time, people in Greater Cincinnati paid $1,025 per month for a studio, $1,155 for one bedroom and $1,275 for two bedrooms. That equates to studios going up by 2.5% over the last year, single bedrooms by 12.7%, and doubles by a whopping 21.4%.
In January, Cincinnati Mayor Aftab Pureval announced that the city would prioritize equitable housing reforms.
Read the full Redfin analysis at The Washington Post.
Allison Babka contributed to this story.
A version of this story originally was published in CityBeat sister newspaper Detroit Metro Times.
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