Report Claims Larger Landlords Exploiting Tenants, Harming Neighborhoods
SACRAMENTO (CBS13) — A new report claims massive companies that own and operate rental homes are exploiting tenants and harming neighborhoods. Many of those companies have an influence in the Sacramento housing market.
"It's really, really frustrating, "said Maricela Castillo.
She and her family lived in an Invitation Home property for two years.
"My stove didn't work for a year and a half," said Castillo.
Her experience wasn't great.
"The carpet was really bad. It was badly installed," said Castillo, "Nails were poking out in a few places."
She says there were no people to talk to, only an online portal.
"It was like talking to a brick wall," said Castillo.
She also experienced a $400 rent increase from one year to the next, which is why she and her family finally moved.
It's a situation that Jovana Farjado, with a housing rights group, sees happen with thousands of renters of large, publicly traded companies that deal in real estate.
"A lot of these families are getting eviction notices and are fighting to have to stay in their home that they've lived in for years," said Farjado.
A report prepared by MIT graduate student Maya Abood outlines issues when there is a saturation of private equity ownership in certain housing markets.
Invitation Homes is a multi-billion dollar company which owns nearly 2,000 homes in Sacramento County. The highest concentrations in North and South Sacramento where the housing downturn hit the hardest. Other companies have also bought up property in Sacramento, but Invitation Homes has the most.
Abood says renters may face fees, rent increases, and shoddy maintenance. She also says the company is beholden to the high demands from investors to increase the company bottom line.
Invitation homes said in a statement that it provides a cheaper option for people looking to get into a single-family home. And it's invested thousands of dollars into each home.
"Those investments not only benefit residents by providing high-quality homes near good schools and good jobs, but also played a critical role in stabilizing local housing markets, and spurring local economic growth.." wrote a spokesperson for Invitation Homes.
While critics of these Wall Street landlords disagree, Castillo ended her renting relationship.
"I'm definitely much happier now," said Castillo with a smile.
She and her husband were able to buy a home with a working stove.
"I have heat," said Castillo, with a smile.
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