Wall Street investors renting out thousands of Orlando-area homes
Starter homes harder to come by; millennials prefer to rent
WINTER SPRINGS, Fla. – Central Florida neighborhoods are undergoing a transformation.
Nationally, there are more households renting today than in more than 50 years, according to census data analyzed by the Pew Research Center.
Part of the reason, according to realtors, is that investors from Wall Street buying up homes, including thousands in Central Florida, which is affecting a lot of local neighborhoods.
Jerome Blake has loaded his U-Haul truck and he's moving.
He's lived in a home on South Alderwood Street in Winter Springs for a year but said the landlord hasn't been responsive when he needed work done on the property. For instance, a tree split following Hurricane Irma, and half of it is hanging above some of the bedrooms at the home.
"I called them about 50 times about this tree," Blake said. "Well, the tree is still here. Nothing happened."
The owner of the property is Invitation Homes, a company that grew out of a Wall Street investment firm called The Blackstone Group in 2012. It's one of a few New York firms that gobbled up thousands of homes in Florida on the cheap after the housing crisis and are now renting them out.
In fact, Invitation Homes is also renting another home just a few doors down from Blake's rental plus a third around the corner.
Roughly 30,000 homes in Central Florida are being now rented out by Wall Street investment firms, according to the Orlando Regional Realtor Association, which means there are fewer properties for people to buy.
"There's now, unfortunately, a real shortage of houses for people can move into as starter homes," said Lou Nimkoff, president of the ORRA.
But economists point out that home ownership has changed since the housing crisis. Many millennials have seen their parents lose their homes, and that's making them look toward renting.
"I think it took a little bit of the shine off of home ownership," said Dr. Sean Snaith of the Institute for Economic Competitiveness at the University of Central Florida.
Snaith added that having Wall Street bundle up rent checks is not the same as when it bundled up mortgages, which helped lead to the financial crisis about a decade ago.
"It's very different here," he said. "What's being bundled together are the payments from renters, not the payments from mortgages that were given to people who were never going to be able to pay it."
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