Half the homes in NJ’s largest city are owned by corporations
It's a trend that started over a decade ago and accelerated during the home buying frenzy of the last two years during the pandemic.
Corporations are buying up homes in small towns and big cities all over the country and it's squeezing out first-time home buyers the most. It's happening to a large scale in New Jersey's largest city, Newark.
As reported by the Patch, nearly half of the homes in Newark are owned by corporations, according to the Rutgers Center on Law, Inequality and Metropolitan Equity, also known as CLIME.
It's said to be happening in Newark at the highest rate in the country. Between 2017 and 2020, about 2,500 homes were sold to institutional buyers. That's more than 47% of the city's buildings with one to four units.
This is happening at three times the rate that it was in 2010, when less than 20% were purchased by institutional buyers. The practice is constitutionally protected to invest in property but local officials are worried about its long-term effects. It could lead to rising rent prices and lower homeownership numbers, not to mention a loss of a sense of community.
It's happening mostly in five neighborhoods above all others, researchers said: Weequahic, Upper Clinton Hill, West Side Park, Fairmount and Vailsburg.
Some of the corporations are large real estate investment companies, but many of the properties were bought up by completely anonymous investors. It's much different from the days of inheriting a relative's house and renting it out or working overtime to buy local houses to rent out as a retirement plan.
This is not something new, but this trend happening on such a large scale is a phenomenon of the past couple of years. It may be happening in your town and you may not notice, but when almost half of the residential properties in our largest city are owned by corporations, it's eye-opening ... and a little worrisome.
Opinions expressed in the post above are those of New Jersey 101.5 talk show host Dennis Malloy only.
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