Landlords and Evictions: Changes in the Ownership of Multi-Family Rental Properties and Its Impact on Housing Stability in Durham, NC
This thesis investigates the changes in the ownership of multi-family rental complexes in Durham between 2000 and 2018 and their subsequent impact on housing stability. Specifically, I model and compare the likelihood that an eviction filing is issued by corporate and individual landlords in the periods before and after a transaction. Since the early 2000s, institutional investor share in all property sizes has increased dramatically in the United States. In 2013, the Blackstone Group released the first-ever rated bond backed by single-family securitized rental payments, and since then, numerous firms have followed with similar security offerings, which as of 2018 include bonds backed by multi-family rental income. The surge of institutional investment in multi-family rental properties and its impacts on communities have remained largely ignored in academic literature. Durham County currently holds one of the highest eviction rates in North Carolina and ranks in the top 40 of highest evicting large cities in the United States. In my thesis, I uncover how ownership of rental properties in Durham has changed since the early 2000s and investigate whether the behaviors of “corporate landlords” differ significantly from those of individual investors (or “mom and pop” landlords”). I find that the proportion of properties under corporate ownership has increased across all property sizes since 2000, and the proportion of corporate owners that are based out-of-state has also increased. I also find evidence to suggest that different sizes of multi-family properties should be examined distinctly, as I uncover different trends across property sizes in both ownership and eviction rates. Using a fixed effects model, I find that overall, individuals appear to have a higher likelihood of filing an eviction against a tenant compared to institutional landlords in the months before and after a transaction. Finally, I find that large investors amongst both corporates and individuals, defined as investors that own more than 15 properties in Durham, are significantly more likely to evict than smaller investors are.
Keywords: Housing stability, real-estate, multi-family rental market, institutional investor, corporate landlord