Although I understand the need to take action about the rising costs of housing, I also understand the need for a more practical solution than creating a slight inconvenience for institutional investors. Per the below article, there is a Bill in Ohio which, if it passes, would add a significant tax for investors with 50 or more homes in the State.
Supply chain issues, rising costs of materials, and supply vs. demand are what drive up housing costs, whether purchase or rental. It would be different if rents were at their current level and there were plenty of vacancies. That is not the case. Having 50 different landlords in the same area for 50 properties does not mean that rents would drop or that the cost to purchase would be any less.
Limiting the number of properties an institutional investor can own is far from being the best solution. Ohio politicians should be glad that some investors elect to own that many properties. Without them, there might not be as large of a supply.
Current institutional investors will continue to have choices even if the Bill to regulate them passes in Ohio. If a group currently owns 54 homes, they will sell off the five which are the least productive. They can form separate LLCs with more partners and/or shell accounts. One more possibility is the number of other states which do NOT have anything like this restriction in place. If they can't invest in bulk in Ohio, they have plenty of other states to choose from. If they go elsewhere, they take away millions of dollars of revenue for Ohio.
I'm not here to discuss the merits of the proposed Bill. To me, the importance of this proposal is to factor into research for upcoming opportunities. If I am looking into bulk investing in single-family in Ohio, I know to keep the number under 50, and to consider investing any additional dollars elsewhere. Even if this Bill does not pass, worrying about its status would not slow down my operation.
A big part of having a research person or team is being aware of changes which could directly impact future revenue. Let's talk about planning for your next real estate success!
https://www.13abc.com/2025/02/20/new-tax-proposed-ohio-landlords-who-own-50-houses-per-county/
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