A housing study commissioned by Harvard University and conducted by local researchers found that foreclosed houses in Northeast Ohio bought by large out-of-state investors saw a high rate of failure. Ideastream's Nick Castele reports.
The study found that houses bought by big outside investors over the past dozen years were more likely than those bought by local investors or community development groups to end up in tax delinquency, condemned or abandoned.
Frank Ford, one of the study's authors, is a senior policy advisor with the Western Reserve Land Conservancy's Thriving Communities Institute. He says some investors admitted in interviews that they bought houses sometimes without even knowing what condition they were in.
"Some of these companies put these properties on eBay, and basically if they could just generate a few hundred dollars from each transaction, and if they do 100 of those transactions, that's actually profitable," Ford said. "It's not good for our Cleveland neighborhoods."
The study also found a large portion of the houses that wound up abandoned or condemned were in largely African-American neighborhoods in Cleveland.
Ford says many have long suspected these things about the housing crisis, but now he's got numbers to back it up.