BELMONT, N.C. — Across the country, the housing market has become unaffordable for many families in the last few years.
Many factors play into the price spikes, including private equity firms purchasing single-family homes, reducing the market size. There is now talk in Congress about how to prevent that.
Spectrum News 1 is taking a look at big issues for voters ahead of the March 5 primary elections in the 14th Congressional District, which runs from west of Charlotte into the mountains.
Since becoming a real estate agent nearly 20 years ago, Chip Wilson says he’s seen it all.
“I got in the business at a time when the Great Recession was at its peak,” Wilson said. “It was kind of a crazy time to get into real estate.”
Wilson is based in Belmont, a town about 15 miles from Charlotte, in the newly drawn 14th Congressional District. The town has exploded in popularity in the last few years.
“We've seen more new housing developments coming up, subdivisions, things like that,” said Wilson. “That's something that's happened probably the last five to seven years.”
But the inventory of homes for sale may not be as big as you think.
Wilson drove us through a new development, just minutes from downtown Belmont, an entire subdivision of single-family homes owned by an institutional investor. Not for sale, but for rent.
“I think they're renting for roughly $2,500 for a four-bedroom three-bath house,” said Wilson. “These are houses that when I first got into the business I probably would have rented for about as low as $1,600, $1,700.”
In recent years, the inventory of single-family homes has shrunk dramatically, causing prices to go up.
One of the big drivers is investment companies buying homes to rent, rather than sell. This drives up buying and rental costs.
It’s a trend consumers are seeing nationwide.
Lawmakers have proposed legislation aimed at slowing or stopping large investors from buying more than 100 single-family homes and mandate they sell them off to add inventory. The hope is to lower prices.
But Wilson, a voter in District 14, says allowing the government to control investors may be going too far.
“We have a free enterprise,” said Wilson. “I can't see how you can take action.”
Instead, he hopes to see congressional leaders find more incentives for homebuyers.
“Rather than trying to restrict the activities of some institutional buyers, they could maybe extend down payment assistance programs. So widen the eligibility for those programs,” he said.
Wilson said he encourages anyone trying to buy a home to reach out to an experienced local real estate agent, who not only will know your area well, but also have expertise on any incentives or assistance programs.
Spectrum News 1 reached out to the candidates for District 14 from both major parties to get their take on housing.
Democrat Pam Genant said she would support something like the End Hedge Fund Control of American Homes act, to get more homes to families.
In a statement, she said, “We need to make sure that we don't continue down this same path, or our children and grandchildren will have no other housing options. Something has to be done to protect the current, longstanding community members and generational property owners as well as future residents.“
The other Democratic candidate in District 14, Brendan Maginnis said he too would support the End Hedge Fund Control of American Homes Act. He also said he would support the American Neighborhoods Protection Act.
"The End Hedge Fund Control of American Homes Act is especially prescient because the current purchasing of homes as investment mirrors the causes of the Great Recession, with rental contracts substituting for sub-prime mortgages. While I prefer to use market forces over regulation, in this case regulation may be needed in order to head off the next financial crisis," he said in a statement.
When asked if he would support the bill, Republican Tim Moore said, “I am a strong supporter of the free market system and government has no roll in limiting private property ownership. Instead of excessive regulation, we need to work to reduce inflation and invest in other initiatives to support home ownership.”
Moore currently serves as the speaker of the North Carolina House.
Instead of focusing on limiting hedge funds, Republican Lillian Joseph said Congress should bring high-paying jobs to the country.
“Because we are a free market society, complete control of the private sector is not the way to do business. Put another way: if private investors are willing to put money into a market, that’s an indication that the economy in that region is thriving. This will encourage more private investment into factories and small and medium-sized businesses. All these things are inter-connected and cannot be looked at in isolation," Joseph said in a statement.
Spectrum News 1 reached out to Republican Candidate Jeff Gregory, but has not received a response.
Editor's note: This story was updated to include additional comments from Republican Tim Moore and Democrat Brendan Maginnis.
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