Law360 (October 11, 2022, 4:44 PM EDT) -- In a continuation of what appears to be a national trend, Wall Street has been rapidly buying up more and more of Phoenix's single-family houses and converting them to rentals, potentially creating headaches for sellers and tenants, as well as additional barriers to first-time homebuyers.

A months long investigation by Law360 Real Estate Authority shows just how prevalent corporate ownership of single-family homes has become in the Valley of the Sun, the nation's fifth-largest city. Through dozens of interviews and on-the-ground reporting, Law360 has learned that a handful of billion-dollar corporations have routinely made high, all-cash offers in order to land deals, sometimes only to use aggressive tactics later to try to squeeze additional money out of the seller.

The trend has contributed to the challenges for first-time buyers. In a city that has seen superlative population growth in recent years, far outpacing new construction, first-time homebuyers often can't compete with cash offers well over asking price. Phoenix home prices have surged 27% in the last year, according to the S&P CoreLogic Case-Shiller home price index. 

Tenants, meanwhile, have few options for reporting landlord concerns and are left largely at the mercy of corporate owners if things go wrong.

Local governments, preoccupied with quality-of-life complaints stemming from short-term rentals, have paid less attention to long-term rentals. And homeowners associations, which have a strong foothold even in the single-family market in Phoenix, have also done little to regulate conversion of for-sale homes to rental properties. Amid a lack of local and state body intervention, tenants, homeowners, housing activists and industry experts in Arizona and across the nation are increasingly looking to the federal government for answers.

A forthcoming six-part series from Law360 Real Estate Authority looks at the trend from a range of perspectives, including sellers, renters, agents, would-be homebuyers, attorneys, advocates and elected officials. The series maps all 65 of Phoenix's ZIP codes, showing just where the trend hits the hardest.

Part 1 of Wall Street's Single-Family Home Grab — an overview of the corporate homeownership rate and its impact in Phoenix — will publish on Oct. 17.

Subsequent stories include a breakdown of supply, demand and pricing; a look at one of the streets where corporations have landed in earnest; a deep dive into the model from a corporate landlord's point of view; an examination of what local and state officials are doing and saying; and a window into Washington's thinking and the role the federal government and courts might play in ensuring oversight of the industry and providing a fair venue for tenants seeking remedy.

Stay tuned . . .

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