The bill also restructured foreclosure auction practices. If the highest bidder at a foreclosure is someone planning to live in the home, the sale is complete. But if a company like Vinebrook buys that same home, the sale is delayed for 45 days to allow an “eligible bidder” to match that bid.
In May, Ohio Sen. Louis Blessing introduced a bill calling for a similar 45-day holding period in his state.
“In Ohio, there was no other legislation that even spoke to this issue. We needed to have a state-level conversation on this,” Blessing said.
City leaders across the country are also demanding reform.
Atlanta Mayor Andre Dickens called for legislation to limit the corporate investors that purchased one-third of homes in Atlanta during the first quarter of 2022. In Newark, Mayor Ras Baraka announced a slew of initiatives to combat real estate behemoths.
A recent “Who Owns Newark?” study found that 47 percent of that city’s one-to-four unit buildings were bought by outside companies.
The study suggested regulations to keep rents and homeownership affordable, discourage speculation and require owner transparency.
Land trusts also may close the gap between Wall Street real estate companies and residents trying to buy their first homes.
Community land trusts are nonprofits that hold land in a trust permanently, allowing people to purchase property on that land and enter a long-term, renewable lease. A 2019 study by the Lincoln Institute of Land Policy found that land trusts lowered the annual move rate to 2.6% in areas where they operate, markedly lower than the 6.9% move rate of all U.S. homeowners.
Northern California Land Trust is the oldest such land trust in California.
“A lot of people share that, there’s no way that they would be in the Bay Area if it wasn’t for living in a land trust property because they wouldn’t have been able to afford it,” said Sarah Scruggs, the trust’s policy director.
There are no community land trusts in Nebraska. Although the Omaha Municipal Land Bank sounds similar, its programs differ in the length and depth of the organization’s involvement. Community land trusts, for example, focus solely on affordable housing.
There is some action locally.
In Omaha, Front Porch Investments awarded $7.3 million in March to promote development of local affordable housing. Awardees were a mix of nonprofits and redevelopment groups, including Habitat for Humanity, which recently broke ground on the $25 million Bluestem Prairie development in North Omaha.
“The concept of buying properties to then have portfolios is a story as old as time,” said Naomi Hattaway, Director of Communications and Community Strategy at Front Porch Investments. “We can’t just point fingers and say you’re bad. But if we can’t offer solutions, or hold them to a higher bar, it’s all for naught.”