Charlotte neighborhood the latest to fight back against corporate owners turning homes

“We were being bombarded,” Hamilton said.

Like hundreds of communities across the United States, Hamilton’s neighborhood had become the target of large companies amassing empires of suburban homes for rent. Since the Great Recession, when millions of Americans lost their homes to foreclosure, these companies have been expanding their portfolios of tens of thousands of single-family houses, a disproportionate number of them located in majority-Black neighborhoods like Potters Glen.

The rise of investor purchases has spawned complaints that the companies, flush with Wall Street money, are pricing out first-time home buyers and renting to tenants who have not been properly screened. In Potters Glen, one house owned by Invitation Homes, a $24 billion company created by a Wall Street firm, drew several reports of illegal drugs and gunfire, according to police reports and neighbors.

Facing the influx, Hamilton started asking: “Can’t we stop them?”

The answer, it turns out, appears to be yes.

Using the same legal authority that allows homeowners associations to punish people who fail to cut their grass, the Potters Glen board erected a hurdle for investors: a new rule required any new home buyer to wait two years before renting it out.

Since the board adopted the rule in 2019, property records show the pace of investor purchases has dropped by more than half.

“We didn’t want to become a renter’s paradise,” said Hamilton, a retired executive assistant from Ohio. “We want people who are going to plant flowers and trees because it’s their home.”

As neighborhoods in several states have moved to adopt similar rules, advocates for rental home companies argue that the restrictions make housing less affordable. They say rental exclusions also can be discriminatory, echoing a past when real estate restrictions were used to keep out racial minorities, and have asked state legislatures in Florida, Georgia and Tennessee, as well as North Carolina, to protect them from such restrictions.

“Preventing single-family rental home companies — of any size — from purchasing homes in a community does nothing but reduce the availability of affordably priced rental housing,” said David Howard, executive director of the National Rental Home Council.

Invitation Homes, one of several big firms that own houses in Potters Glen, called the rental restrictions “prejudicial, discriminatory, uninformed, and misaligned with the concept of fair housing.” The company said it was “disheartened by the trend of HOAs [homeowners associations] determining that renters are not welcome in their neighborhoods.”

Of the house in Potters Glen where neighbors had reported gunfire, Invitation Homes said it had used a reputable third-party screening company to vet the adult tenants — and that it eventually asked them to leave.

Hamilton scoffed at the idea that the new rules discriminate against renters, arguing that the board has the right to encourage homeowners to live in the community.

“Don’t get me wrong — there are some very good renters in this neighborhood,” she said. “But people who own their homes usually take more pride in their property, and we wanted to make sure we keep a place for them.”

Corporate landlords take stakes in U.S. suburbia

As investors have targeted the American suburbs, faraway companies have begun to take over entire blocks. Last year, investors bought nearly 1 in 7 homes sold in the nation’s top metropolitan areas — the most in two decades of record-keeping, according to a Washington Post analysis of data from realty company Redfin.

In Charlotte and elsewhere, according to The Post’s analysis, investors have purchased a disproportionate number of homes in neighborhoods where a majority of residents are Black. Last year, 30 percent of home sales in majority Black neighborhoods across the nation were to investors, compared with 12 percent in other Zip codes, The Post’s analysis shows.

In Charlotte and surrounding Mecklenburg County, landlords backed by Wall Street own roughly 11,500 houses — more than 4 percent of single family homes, according to an analysis last year by the University of North Carolina at Charlotte Urban Institute. Most of the houses are in the starter home price range, “likely putting the most pressure on the lower end of the market,” said the institute’s Ely Portillo.

Most of those purchases were made by one of six major out-of-state companies: Progress Residential, American Homes 4 Rent and Invitation Homes each owned more than 2,000 homes, according to the Urban Institute analysis, while Tricon, Amherst Residential and FirstKey each had more than 1,000 homes.

Faced with this surge of corporate landlords, many homeowners associations have begun to fight back.

At the Reserve at Back Creek, a subdivision of 39 houses near UNC-Charlotte, neighbors last year adopted a rule requiring an owner to live in a house for a year before renting it out. No more than 18 percent of the houses can be approved for rental at any time.

“Our main concern was with the faceless investment groups who were buying the homes more than just the renters,” said Justin Kerner, 41, a former association board member. “If we’re sending a notice about garbage on the lawn to a company in Las Vegas, it’s going to end up on the desk of someone who doesn’t care what the neighborhood looks like.”

At Avalon at Mallard Creek, a community of 110 townhouses not far from Potters Glen, a shooting last year that damaged several properties prompted the neighborhood to impose a one-year waiting period on rentals and cap them at 40 percent of units. They also required leases to be approved by the homeowners association board, which can reject a rental agreement based on investigative background reports.

“Six homes had bullet holes,” said Keri Miller, the homeowners association treasurer. The shooting, which involved outsiders targeting a tenant in a rental, Miller said, made her not only fearful but angry that the association…