Here's what happens when private equity buys homes in your neighborhood

"Daniel Erb became a corporate landlord kind of by accident. It started in 2020, when he received his first bonus as an investment banker. It was more money than he was used to. He wanted to invest in real estate, so he called his cousin, a research analyst at BlackRock, for advice. As they talked over options, his cousin showed him a striking chart of the number of "housing starts" in the U.S. since 1950 (basically the number of new houses and apartments built each year)."

"It showed that the last 10 years had the fewest starts since the 1960s, even though the U.S. population was now much larger. It was a full decade of underinvestment. They focused on single-family homes the classic house with a yard, often in the suburbs. "I'm a millennial," says Erb. "I've always envisioned having a home." But none of his friends had bought a house yet. Neither had he."

Daniel Erb became a corporate landlord after investing his investment-banker bonus in 2020. A chart showed a decade of low U.S. housing starts despite population growth, indicating underinvestment. Erb and his cousin targeted single-family homes and raised investor capital to buy properties in affordable, redeveloping neighborhoods like Chatham-Arch in Indianapolis. They rented these homes to people who wanted yards but could not afford to buy, and the business proved profitable. Private equity firm Blackstone began large-scale buy-to-rent investing in 2012 with Invitation Homes, now a public company valued above $18 billion. The growth of corporate landlords has drawn bipartisan criticism and political calls to ban them.

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