PHOTO: Las Vegas. FILE
Last summer, a corporate landlord with backing from Wall Street acquired hundreds of homes in Las Vegas through a substantial one-time residential sale. Invitation Homes, based in Dallas, expended $98 million to procure 264 homes in Clark County, as indicated by property records.
This transaction was part of a substantial $650 million exchange involving nearly 1,900 single-family rental homes between the private equity fund of billionaire Barry Sternlicht, Starwood Capital, and Invitation Homes. With this deal, Invitation Homes has become the second-largest owner of single-family rental homes in Clark County, now possessing 3,500 homes, according to data from the Las Vegas Review Journal.
This acquisition is noteworthy amid Las Vegas grappling with a severe housing shortage and a surge in evictions, positioning the city as the one with the most acute shortage of affordable housing in the United States.
The significant property purchase follows recent alarming statistics suggesting that corporate entities could own up to 40 percent of all U.S. homes by 2030. Millennials entering middle age are facing challenges in entering the property market due to low inventory and escalating prices.
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Nevada is currently contending with a critical housing shortage, witnessing a rise in evictions. Disturbingly, only 14 units are available for every 100 extremely low-income households in need. Nevada boasts the highest percentage in the U.S. of extremely low-income renters who are severely cost-burdened, allocating more than 50 percent of their income to rent and housing expenses.
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Eviction filings in Las Vegas have surged from 3,931 cases in fiscal year 2019 to 5,328 in fiscal year 2022, marking a roughly 35 percent increase. The affordable housing crisis in Las Vegas could potentially escalate into a more profound homelessness crisis, as warned by Princeton’s Eviction Lab.
The Starwood Capital and Invitation Homes Las Vegas Swap unfolded in three separate transactions. The largest involved the sale of 155 homes for $57.5 million, followed by a $26.3 million deal for 70 homes and a $14.1 million transaction for 39 homes.
Most of the sold homes are situated in the city of Las Vegas, with an additional 77 in North Las Vegas. The broader portfolio encompasses homes across the Sun Belt, including Texas, Florida, Phoenix, Las Vegas, and Los Angeles.
As of the third quarter of 2023, Invitation Homes had acquired 2,291 homes for $854 million during the year, as disclosed in its latest earnings report. A Las Vegas real estate agent, Noah Herrera, commented, “They’ve turned these homes into collateralized rental obligations. They’ve collateralized them, and what they’re doing is swapping homes like stocks for one another,” according to the Las Vegas Review Journal.
SOURCE: THE DAILY MAIL