Investors purchased majority of affordable homes in 2017

Nearly two-thirds of affordable homes were purchased by investors in 2017, according to a report released this week. That’s nearly double the share since the foreclosure crisis and a sign that homeownership is increasingly unattainable for most New Yorkers, the study’s authors contend.

The Center of New York City Neighborhoods found that 62% of affordable homes—which it defines as a property a household making the median income could purchase with a mortgage—were purchased mostly with cash in 2017 by limited-liability companies, frequent buyers of homes, or entities that flipped the property within a year.

“Affordable homeownership is key to building a more inclusive and equitable New York, and as inequality in our city grows, preserving affordable homeownership has become more important than ever,” the nonprofit’s chief executive, Christie Peale, said in a statement.

The city’s housing market is essentially the inverse of the rest of the country: Nearly two-thirds of the population rents. Homeownership can be difficult because housing costs in general have far outpaced wage gains, demand drove up prices dramatically in the wake of the recession, and the city has a limited number of programs that focus on building affordable homes for purchase. The de Blasio administration has focused most of its energy on building and preserving the rentals because costs are more predictable for lower-income households who don’t have to shoulder the costs of maintaining a home.

https://www.crainsnewyork.com/real-estate/investors-purchased-majority-affordable-homes-2017