Corporate Landlords, Institutional Investors, and Displacement: Eviction Rates in Single-Family Rentals
Federal Reserve Bank of Atlanta
Community and Economic Development Department
Discussion Paper 2016-4
In this research the authors document the eviction crisis in the city of Atlanta and adjacent suburbs. The authors place eviction-driven housing instability in the broader context of changing housing markets, examining the relationships between post-foreclosure single-family rentals, large corporate landlords, and eviction rates. The rise of the large corporate landlord in the single-family rental market has the potential to rehabilitate vacant properties and offer affordable housing in desirable neighborhoods, or conversely could perpetuate housing instability and spatial inequality. To understand the eviction rate in Atlanta and investigate how corporate ownership relates to housing instability, the authors use a unique data set: publicly available, parcel-level eviction records from Fulton County, Georgia. The authors document a high, spatially concentrated eviction rate. Over 20 percent of all rental households received an eviction notice in 2015 and up to 12.2 percent of all households were forcibly displaced. Evictions are spatially concentrated: in some zip codes over 40 percent of all rental households received an eviction notice and over 15 percent of all households were evicted.
Examining single-family rentals with a cross-sectional regression, the authors find that large corporate owners of single-family rentals, defined as firms with more than 15 single-family rental homes in Fulton County, are 8 percent more likely than small landlords to file eviction notices. Although evictions are highly correlated with neighborhood characteristics such as education levels, change in the employment-population rate, and racial composition, the trend holds true even after controlling for property and neighborhood characteristics. Another analysis identifies large private equity investors and finds that some firms have uniquely high eviction rates. Some of the largest firms file eviction notices on a third of their properties in a year and have an 18 percent higher housing instability rate even after controlling for property and neighborhood characteristics.
JEL Classification: R3 real estate markets, spatial production analysis, firm location
Key words: evictions, institutional investors, private equity, Atlanta, post-foreclosure, single-family rental
The authors would like to thank Karen Leone de Nie, assistant vice president of community and economic development at the Federal Reserve Bank of Atlanta; Dan Immergluck, a professor in the School of City and Regional Planning at Georgia Institute of Technology and a visiting scholar at the Atlanta Fed; Ann Carpenter, community and economic development adviser at the Atlanta Fed; Cole Thaler, project director at Atlanta Volunteer Lawyers Foundation; Rob Call, master's student in the department of urban studies at Massachusetts Institute of Technology; and Chris Cunningham, Atlanta Fed research economist and assistant policy adviser for thoughtful comments and review of this work during drafts. The views expressed here are the authors' and not necessarily those of the Federal Reserve Bank of Atlanta or the Federal Reserve System. Any remaining errors are the authors' responsibility.
Comments to the author are welcome at Elora.Raymond@atl.frb.org.