Corporate investors sucked up 1 of 3 Arizona homes on the market. That must end

There’s a good reason the population of our state grew at nearly double the national average over the last decade and was ranked among the top five fastest-growing states: Opportunity.

But despite our economic growth, the cost of housing is growing way faster than wages.

To afford the average single-family home in metro Phoenix, you now need to have a six-figure income. But the median annual salary for a full-time employee in Arizona as of January 2024 is $52,700.

People who serve our communities, like teachers, nurses and first responders, are being priced out of home ownership and the American Dream in Arizona.

Instead of becoming homeowners, they’re quickly finding themselves as cost-burdened renters, meaning they will spend more than 30% of their monthly income on the average apartment.

Corporate investors are gobbling up homes

A For Sale sign is posted outside a home in Glendale, Ariz. on Feb. 26, 2024.
A For Sale sign is posted outside a home in Glendale, Ariz. on Feb. 26, 2024.

There are several reasons for the sky high cost of housing, but one that isn’t talked about enough: Price-gouging middlemen.

Megacorporations make their investors and executives filthy rich by hiking prices on many of our basic needs, including prescription drugs and groceries.

It’s no surprise that rents and mortgages are also a target for greedy investors looking to make a big profit on the backs of hardworking Arizonans.

Concerningly, Arizona has become a top location for out-of-state property investors.

One Pew Research Center study found that Wall Street hedge funds and other corporate investors purchased an eye-popping 1 out of every 3 single-family homes in Arizona on the market in 2021.

Only Georgia had more of its homes purchased by corporate investors than Arizona.

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When predatory corporate landlords purchase local single-family homes, it sets off a vicious cycle.

Rich investors outbid Arizona families with cash offers and keep starter homes out of the hands of would-be owners. Corporate investors then often either convert the homes into short-term rentals, which contribute to a rise in rent prices in the area, or they rent the homes out for exorbitant prices.

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We were elected to serve our constituents who are here for the long-term, not corporate special interests looking for short-term profit. As we continue to fight for good economic policy at the state Legislature, lowering rents and mortgages for everyday Arizonans must be a priority for every legislator.

That’s why we’ve introduced House Bill 2763 and Senate Bill 1542 this legislative session — mirror bills aimed at stopping hedge funds and corporate landlords from dominating Arizona’s housing market and artificially inflating housing costs.

The legislation creates transparency by requiring corporate investors to disclose how many single-family homes they own in our state. And it takes on the corporations that are jacking up housing prices by capping the number of single-family homes they can purchase at 100 per year.

Arizona homes should be owned by Arizonans

Ensuring that rich corporations have to play by rules that don’t put hardworking middle-class families at a disadvantage is reasonable and fair policy that is supported across the country on both sides of the aisle.

There is no silver bullet to solve the affordable housing crisis. Lowering housing costs will take an all-of-the-above approach.

But Arizona homes must belong to Arizona families — not out-of-state corporate investors. Reining in the corporations that are running a monopoly on our housing supply is one important step we must take to lower housing costs for everyday Arizonans.

State Rep. Oscar De Los Santos represents District 11 and is assistant leader of the Arizona House Democrats. State Sen. Juan Mendez represents District 8 and is assistant leader of the Arizona Senate Democrats. On X, formerly Twitter, at @os_delossantos and @mendezforaz.

This article originally appeared on Arizona Republic: Corporate investors snatch 1 of 3 Arizona homes. That must end