Breaking News
More () »

'It's a huge problem' | Memphis area buyers, realtors warn that outside investors continue to be an issue

Realtors are urging homeowner associations to crack down on what they argue is limiting available homes for local families—turning homes into expensive rentals.

MEMPHIS, Tennessee — According to the Shelby County Assessor's Office, in the past two years, outside investment groups with no stake in Shelby County bought up more than 7,000 single-family homes.

Area realtors said that's limiting the number of homes available, driving up rental prices and putting homeownership further out of reach for more people.

That includes Brittany Benefield of Memphis.

"Having that chance taken each time—it's frustrating but it's also disheartening too," Benefield said.

Since December, she said she put down six different offers on homes across Memphis and lost out on each—all for the same reason.

"Every single time it's been an investor cash offer that's taken it away," Benefield said.

Those in the Memphis-area real estate market said more and more prospective homebuyers are in the same boat as Benefield. This, as local buyers are outbid by out-of-state investors who pay all in cash, sometimes tens of thousands of dollars above asking price.

"They have unlimited pockets and they are boxing out our families and that's tough to deal with," Kevin Stafford at Integrity Mortgage Group said.

"These investors now are literally sitting on properties to drive up the market, to drive up the rent and it's going to cripple America," Ashley Stafford at Integrity Mortgage Group said.

The couple said investors are purchasing so many local homes that many would-be buyers are simply giving up. 

"We have customers that have put in for 20, 30 properties and they are in no better spot today than they were three months ago," Kevin Stafford said.

Ashley Stafford said homeowner associations must fight the trend on their terms.

"As a homeowner, you can go to your local Homeowner Associations and you can get it changed to where LLCs can't come in and rent in your neighborhood," she said. "I think that's where everyone should start."

The realtor said local home sellers should weigh the potential long-term consequences against a short-term benefit.

"It's just important for them to consider a family over an investor," Ashley Stafford said. "It's going to ruin the economy—there's a bigger picture here."

As for Benefield, despite her local housing market setbacks, she's not giving up.

"I'm not trying to get too discouraged," Benefield said. "I'm not stopping my look because it is a goal of mine to own a home—to do it all by myself."

Shelby County Assessor Melvin Burgess asked the Shelby County attorney what zoning options could be possible for homeowner associations to limit home purchases by outside investors.

RELATED: New 30-year mortgage rate highest in 13 years

RELATED: Redfin settles lawsuit alleging housing discrimination

RELATED: 'It's not fair' | How investors are causing headaches for Memphis area home buyers

RELATED: Best tips for first-time home buyers

Paid Advertisement