No major U.S. metro area has more single-family rental (SFR) homes owned by institutional investors than Atlanta, with current totals sitting at roughly 72,000 houses \u2014 nearly doubling No. 2 Phoenix.<\/p>\n
That concentration represents about 30% of Atlanta\u2019s<\/a> single-family rental market, a share 10 times the national average, according to a new report from the American Economic Liberties Project<\/strong>. <\/p>\n In some individual nearby suburbs, report findings are even starker. Corporations own 78% of all single-family rentals in Paulding County and 64% in Henry County. <\/p>\n The report, titled \u201cThe New Rent Seekers,\u201d<\/a> argues Atlanta did not become the epicenter of corporate landlordism by accident. <\/p>\n It points to federal policy choices after the 2008 financial crisis \u2014 from lack of support for small homebuilders<\/a> to incentivizing bulk acquisitions \u2014 as key components in \u201cturning the city into a laboratory for a new asset class.\u201d<\/p>\n For real estate agents working with first-time buyers<\/a>, the impact is hard to miss, according to Atlanta-based eXp Realty agent Tracy Lovig.<\/p>\n She told HousingWire<\/strong> it shows up in multiple cash offers on homes that need major repairs, as well as in steady conversion of for-sale inventory into permanent rental stock.<\/p>\n \u201cWhen it\u2019s the average home prices \u2014 $400,000 to $600,000, especially $500,000 and under \u2014 the investors want to come in,\u201d said Lovig. \u201cAnd of course, they\u2019re going to come in and bid high to start with, until they come in and do inspections, and then they get them to drop down the price. <\/p>\n \u201cBut our first-time homebuyers and medium-income families have trouble buying these homes because of the renovations that do need to be done. They could have old roofs, old HVAC. They\u2019re still functional, but they\u2019re going to have to be replaced.\u201d<\/p>\n Atlanta household income vs. homeownership rate. Source: American Community Survey 5-year estimates<\/p>\n Lovig recalled a recent estate sale listed at $500,000. <\/p>\n \u201cWe had the 70s tile in the bathroom, the old wood cabinets, paneling on the walls,\u201d she said. \u201cSo, tons of stuff needed to be updated in this house, and the ceiling in the basement was sagging. My client was willing to pay $450,000 for it. When I sent the offer in, the agent said, \u2018You\u2019ve got to be kidding me. We have 12 cash offers from investors at full price or higher.\u2019 <\/p>\n \u201cMy buyer did not have the funds to go over, knowing the work that had to be done to the house. So they got outbid. When it actually went to closing, the investors had gotten them down to $480,000.\u201d<\/p>\n After 2008, Atlanta offered a perfect storm: a swell of foreclosed<\/a> homes, landlord-friendly Georgia laws with swift eviction procedures and no rent control and a homebuilding industry that had collapsed, the report cites.<\/p>\n Data also shows the number of homebuilders in Atlanta falling by 90% since the financial crisis, from 2,000 to just 200 \u2014 with large, publicly traded builders now holding nearly 70% of the market.<\/p>\n During one 12-month stretch beginning in July 2021, investors bought roughly one-third<\/a> of homes for sale in metro Atlanta \u2014 mostly with cash offers at asking price. <\/p>\n Attorney Laurel Kilgour, the report\u2019s author and research manager at the American Economic Liberties Project, said impact varies dramatically by neighborhood \u2014 a nuance often lost in industry arguments.<\/p>\n \u201cA lot of the proponents will point to the broadest geography possible to make their point, to sort of underplay what is going on here,\u201d Kilgour said. \u201cSo, a lot of times they will talk about the single-digit percentage of institutional investor holdings nationally, or they will look at only the entire Atlanta metro region.<\/p>\n \u201cThat doesn\u2019t really tell you much about what the actual control is. They find a variety of ways to sort of downplay it. You really do need to pay attention to what is going on at the neighborhood level.\u201d<\/p>\n Atlanta saw more than 3,000 build-to-rent units<\/a> delivered in 2024 alone \u2014 and nearly another 7,000 under construction as of February. <\/p>\n More than one in 10 new homes in Atlanta are now off limits to ordinary buyers before they are even built, the report shows, citing data<\/a> from rental marketplace Point2Homes<\/strong>.<\/p>\n Kilgour warned that real estate agents should pay close attention to this model, which she called poised to \u201cexplode exponentially.\u201d <\/p>\n Since 2019, build-to-rent inventory in Atlanta has soared by 1,381%, data shows. <\/p>\n \u201cThe question that comes up with very large tracts of land and development is, is that land going to be Wall Street outbidding everyone else who could use the land for building homes that will be sold to ordinary families?\u201d Kilgour said. \u201cThat\u2019s a very significant thing that will change the market fundamentally in a lot of ways. <\/p>\n \u201cYou just won\u2019t have as much inventory to sell the more that land is being reserved from the beginning for this emerging build-to-rent pipeline.\u201d<\/p>\n She noted that Pretium Partners<\/strong> \u2014 one of the three largest single-family rental owners in Atlanta \u2014 has already securitized financial products<\/a> backed by build-to-rent assets. <\/p>\n \u201cPart of what I\u2019ve looked at is this trend of Wall Street using Atlanta as a testing ground,\u201d said Kilgour. \u201cReal estate agents should be paying attention to what is happening in Atlanta, because that is the future for the rest of the country, if policymakers don\u2019t act now.\u201d<\/p>\n Lovig said she and other agents in her mastermind group have taken proactive steps to understand the build-to-rent trajectory. <\/p>\n Within five miles of her, there are five such communities \u2014 two townhome developments and three single-family subdivisions.<\/p>\n \u201cWe did go talk to them,\u201d Lovig said. \u201cThey do have HOA standards that they\u2019re adhering to. So, we have to go in and reinforce to the buyers and sellers in the area to say, \u2018Look, they have an HOA, just like these other subdivisions. They\u2019re going to maintain the subdivisions. They\u2019re not going to let people move in here and just destroy these properties.’\u201d<\/p>\n She added that the rental rates are higher than many assume. <\/p>\n \u201cIn our area, they\u2019re going to start about $2,500 or $3,000 a month, so they\u2019re not cheap,\u201d Lovig said. \u201cIt\u2019s not something that\u2019s going to come in and drive values down.\u201d<\/p>\n Lovig noted that pending legislation is already shifting investor behavior in Georgia.<\/p>\nHow Atlanta became ground zero<\/h2>\n
The build-to-rent explosion<\/strong><\/h2>\n
New legislation alters buying behavior <\/h2>\n