ORLANDO, Fla. — Data shows investors bought nearly a quarter of the available homes for sale in the metro Orlando last year -- well above the national average.
An analysis of the numbers shows a trend that affects not only prospective homebuyers but also renters.
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The market is particularly challenging for homebuyers now as they’re competing with investors or even corporations who are often willing to pay cash.
Many times, those investors are turning the properties around as rentals with sky-high rates.
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Marcus Springfield is a local homebuyer who said he has been sleeping where he works and living away from his fiancée and children as they save, search and try repeatedly to buy a home.
“We were walking away just knowing we were going to get outbid,” he said.
(1/6) Across the U.S., buyers need 34% more income to afford a home compared to last year. House hunters in the Sun Belt will need 40% or more. #housing— Redfin (@Redfin) April 27, 2022
Springfield said he kept a folder of about 30 homes they visited during their six-month search from Winter Park to Chuluota.
“We were being priced out by these commercial corporations coming in with cash, buying these residential homes,” he said.
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Data compiled by real estate brokerage firm Redfin shows that Orlando was among the top 10 metros in the country for investor purchases last year, with at least 11,740 properties bought in 2021 or about 22 percent of all homes sold.
“It’s unfortunate that investors are looking at homes as a way to make a profit when a lot of people want to own a home because it’s where they live,” said Daryl Fairweather, Redfin’s chief economist. “They want to raise a family there. They want to feel connected to the home, not just be a renter where everything else is handled by a corporation.”
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The disparity is even worse in predominantly Black communities, Redfin’s data shows.
In the 32805 ZIP code, which includes Parramore and Washington Shores, the population is more than 70 percent Black. Last year, 45 percent of homes sold there were purchased by investors.
The 32811 ZIP code, which includes Carver Shores and Richmond Heights, is nearly 80 percent Black or Hispanic, and it saw more than 200 homes purchased by investors in 2021, accounting for nearly 40 percent of homes sold.
In the 32839 ZIP code, which includes Holden Heights and Millenia, 75 percent of the population is Black or brown. There, they saw 37 percent of homes sold go to investors.
Those sales could potentially price people out of the neighborhoods they’ve called home.
“Anytime that you have more renters than homeowners, gentrification is a risk in terms of displacement, in terms of people being priced out of where they can live,” Fairweather said.
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After being outbid more than a dozen times, Springfield finally has an offer accepted in Oviedo after dropping their cosmetic standards and agreeing to pay far above the appraised value.
“It’s sickening when you sit down and start putting the numbers together and you see the zeroes add up and the commas, but still trying to budget,” he said. “You still want to have your safety net -- a few months mortgage and your savings -- but sometimes you’re going to have to stretch that.”
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