ATLANTA – Out-of-state investors own tens of thousands of houses in Georgia, and lawmakers tried to limit the number due to concerns about decaying properties and diminished options for would be homeowners.
A bill that sought to cap each big owner at 2,000 properties didn’t get far after constitutional concerns were raised. But a measure that requires these companies to hire Georgia brokers did pass, and some lawmakers are waiting to see whether it will become law.
House Bill 399 also requires tenants of houses or duplexes to give code enforcement officers the contact information for the property manager.
First, the tenants have to know who manages their property, which is one reason Rep. Mary Margaret Oliver, D-Decatur, gave for bringing her bill.
“It requires out-of-state investors, hedge fund type entities to have a local broker and a local property manager,” Oliver said last week. She said local officials often cannot identify the owners of properties that have deteriorated to the point that they are violating local ordinances.
Sen. Max Burns, R-Sylvania, carried the bill through the Senate, which had just passed the measure 41-9 when the two talked about it with reporters.
“The renter has to have someone that they can call and talk to and resolve any problem,” Burns said, adding that investors had acquired whole subdivisions in suburban Augusta near his hometown.
“They all go into the rental market. And that undermines the single-family home buyer, especially that first-time homebuyer,” he said.
Seven corporations own more than 51,000 single-family homes in the 21-county metro Atlanta region, according to a blog by the Atlanta Regional Commission late last year.
Paulding County in northwest metro Atlanta was a hotspot for this ownership model, with as much as a fifth of the single-family homes in some census tracts there owned by investors, the ARC reported, using data provided by Parcl Labs. Overall, 6.5% of the houses in Paulding were corporate-owned.
Rep. Martin Momtahan, R-Dallas, said he has constituents in Paulding who don’t know how to contact their out-of-state landlords.
“They have a lot of issues with just getting things fixed,” he said. “Imagine a septic tank is leaking in your backyard.”
Momtahan voted for HB 399 and also was among all but one of the lawmakers on the House Judiciary Committee who voted for a more aggressive bill last month. House Bill 555 sought to limit companies from having an ownership interest in more than 2,000 single-family residences or 10 multifamily residences in Georgia.
Former state Attorney General Sam Olens testified against the bill as a representative of the National Home Rental Council, calling it “constitutionally unfirm.” He said investors who buy houses are doing Georgians a favor by renting them out at a lower monthly price than renters would be paying if they bought a house under current mortgage rates.
A representative of the Georgia Association of Realtors also opposed the bill, saying investor home ownership is a problem but that HB 555 wouldn’t fix it. Corporate owners would just create a network of subsidiary companies that would each own fewer than 2,000 properties, she said. She also said her group opposed a bill by Momtahan that would have required companies to disclose the properties they own, so local governments could keep track.
The vice chairman of the committee, Rep. Matt Reeves, R-Duluth, said creating subsidiary companies to hide properties would be illegal.
“If a company large or small does a transfer of an asset to avoid the law, that’s fraudulent,” he said. “Give the American Dream back to individual homeowners in Georgia. That’s what this bill is trying to do.”
HB 555 passed that committee on March 3, but didn’t get a vote by the full House of Representatives. It will remain in play when lawmakers return next year though.
Meanwhile, lawmakers are waiting to see whether Gov. Brian Kemp will sign HB 399 into law, opening a new channel of communication with these big property owners.