LA City Council To Consider Motion To Stop Tech Companies From Buying Up Family Homes

LOS ANGELES (CBSLA) – The Los Angeles City Council Thursday will consider a motion that seeks to prevent tech companies and private equity firms from purchasing affordable, predominantly single-family housing as investments.

"The housing crisis has been further exacerbated by high tech companies such as Zillow, Opendoor, Rockethomes and Redfin as well as private equity firms," the motion reads. "These companies primarily target affordable, single-family homes and compete to buy up as much inventory as possible, flip them and then sell them for a profit."

If passed, the motion will instruct the Chief Legislative Analyst and the City Attorney to report on recommended strategies that L.A. can use to prevent tech and private equity firms from engaging in speculative practices involving affordable, single-family housing.

The motion comes amid L.A.'s worsening affordable housing crisis, with the ranking among the top most unaffordable cities each year, which has also contributed to the city's growing homeless population.

In late September, California Gov. Gavin Newsom signed a string of new laws directed at tackling the state's ongoing homeless crisis. Among the big changes - one of the laws will give the state more power over how cities and counties spend funds to solve homelessness. The legislation also sets aside money towards the construction of 84,000 affordable homes.

Newsom also signed a law in September that will allow homeowners across the state to build more housing on the land they own.

"As of Aug. 21, the L.A. city recorded a price increase of 11.3% compared to the prior year," L.A. City Council President Nury Martinez said in her motion. "...Low-income Angelenos, who have lived in their neighborhoods for decades, are unable to compete with these iBuyers. This has led to many longtime residents being pushed out of their homes, neighborhoods and communities."

(© Copyright 2021 CBS Broadcasting Inc. All Rights Reserved. City News Service contributed to this report.)