Homes For Profit: Tenant Experiences

Somerville 6 Unit Building

  • When an investor purchased her 6 unit building in 2021, they told Vanessa and her family to leave the apartment they'd lived in for over a decade

  • The Community Action Agency of Somerville (CAAS) helped Vanessa negotiate to stay for 2 more years so that her son could graduate from Somerville High School

  • Our data shows 11 properties in Greater Boston purchased by the same investor since 2016 for a total of $9,385,145 (2022 USD)

    • A 2022 Boston Globe article noted this investor had a 61-unit real estate portfolio valued at $21 million shared on his public Instagram page

    • Some of these additional properties MAY have been purchased through one of the 19 LLCs this investor is involved with, which may explain why they didn't appear in our data

Lynn Apartment Building

  • Weeks after purchasing their apartment building an investor raised their tenants' rents by $435 to $700 per month

  • Lynn United for Change helped tenants negotiate a more gradual, but still significant, rent increase that allowed most, but not all, tenants to remain in their homes

  • The rent increases displaced two families. One family of a recent high school graduate was forced to move far from the local community college where he hoped to start classes

  • According to our data, the investor who purchased this building has purchased a total of 20 properties in MA worth $29 million (2022 USD) since 2000

    • This makes them an 'Institutional Investor'

    • This investor is potentially involved in five LLCs related to purchasing and managing MA realty, indicating that they likely own even more properties than what we captured in our data

Blue Hill Ave Apartment Buildings - Mattapan

  • Following the opening of the Blue Hill Ave commuter rail station, 12 nearby apartment buildings were purchased by an investment group

  • The purchase was made through an LLC managed by the investment group's Chief Investment Officer and Chief Operating Officer

    • Both the CIO and COO are listed on more than 10 other LLCs, indicating that it is common for this investment group to use LLCs to purchase property

  • The new owners increased rents $275 per month

  • Elderly residents on fixed incomes, some who have lived in their homes for 40 years, are concerned they'll end up in a shelter if they're displaced

A Better Outcome is Possible

  • After 14 years in her East Boston apartment, Ana came home to find a notice to quit on her door as the new owners looked to evict all current tenants and flip the property

  • After years of fighting her eviction with the help of City Life/Vida Urbana, the city stepped in and purchased Ana's building and several others in the neighborhood

  • East Boston Neighborhood Trust formed to manage the mostly 2+ bedroom units in 3 family properties purchased in 2022

  • All 114 units in the portfolio are income-restricted, with most units reserved for residents making less than 60% of the area median income

Lack of Transparency around Limited Liability Companies (LLCs)

  • Why use an LLC?

    • LLCs protect owners from personal liability

      • Not personally liable in lawsuits

      • Protects personal assets

    • Creates a layer anonymity as the LLC name is listed on the mortgage and deed

    • Tax benefits – taxes on the property are paid by the LLC, not personally by owners and can be taxed at a lower corporate rate

    • Easier for multiple owners to share property ownership

  • The Problem: the anonymity of LLCs makes it difficult for researchers, tenants, and housing advocates to understand who owns residential real estate

Homes for Profit: Tenant Experiences

By MAPC

Homes for Profit: Tenant Experiences

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