Fishers sees out-of-state investors plaguing housing economy

FISHERS, Ind. (WISH) — A new housing study done by the City of Fishers details the growing phenomenon of out-of-state investment companies buying homes for cheap and putting them on the market for hiked-up rents.

According to the study, nearly 1,000 homes are owned by investment companies and about a third of those companies are not located in Indiana.

“It’s a logical play by Wall Street to be able to go into an area where they know these assets, these homes, are going to appreciate in value,” Fishers mayor Scott Fadness said.

Fadness responded to I-Team 8’s story from Tuesday, that uncovered this issue.

Fadness says Fishers, like many suburbs around the country, is seeing an increasing number of investment companies taking over the local housing economy.

“Fishers, Carmel, Noblesville, Westfield, all of us — we’re at a lower price point relative to the rest of the country,” Fadness said. “But we’re an attractive place to live, so the likelihood that an asset is going to continue to appreciate over the next several years is pretty good.”

The study found that in Fishers, the following companies are the most active and currently maintain a combined 159 single-family rental units:

• FirstKey Homes of Marietta, GA: 97 units (86 acquired in the study period)
• KKR/Mch SFR of New York City, NY: 29 units (22 acquired in the study period)
• Progress Residential of Scottsdale, AZ: 22 units (21 acquired in the study period).
• American Homes 4 Rent of Calabasas, CA: 11 units (4 acquired in study period)
• Tricon Residential of Toronto, Canada: 8 units (8 acquired in study period)

Fadness says investment companies used to purchase homes that were in “distress” or relatively cheap. However, the study shows the average sales price of homes bought by investment companies in Fishers is $220,000. Fadness says it’s going beyond keeping low- to middle-income people out of the housing market.

 “[For] most people, their ability to accumulate wealth in their life is through a smarter, wiser investment in their home,” Fadness said. “Those people that live in those homes as rentals, they’re never going to accumulate wealth through that asset. All of that is going to go out of state.” 

Fadness says that with the study complete, the next step is to find solutions. Once solutions are found, Fadness plans to present his findings to state lawmakers.

“I don’t begrudge [investment companies] for operating in an economically rational way. But we have to look out for the best interests of the people who live here,” Fadness said.