Impact of Institutional Owners on Housing Markets

Abstract

Since the Great Recession, Long-Term Rental (LTR) companies, including single-family rental and private equity firms, have reshaped the U.S. investor landscape. Using housing deeds data from 2010 to 2022, we show that LTRs outpaced other investors, and concentrate geographically. We develop an instrument that predicts LTR market share based on local product preferences and decreasing management costs. A one-standard-deviation increase in LTR share raises house prices by 1.58 p.p., lowers homeownership by 0.53 p.p., and does not affect rents. These averages mask significant temporal heterogeneity. LTRs contribute to a 0.32% national homeownership decline by acquiring homes from owners and speculators.

Keywords: Institutional landlords, Housing markets, Single-Family Rentals