President Joe Biden in his State of the Union address Thursday night proposed heftier taxes and renewed antitrust scrutiny for powerful corporations — moves that, if successful, could temper corporate landlords’ stranglehold on housing markets in metro Atlanta and beyond.
“It’s time to raise the corporate minimum tax to at least 21% so every big corporation finally begins to pay their fair share,” Biden said, later adding, “For millions of renters, we’re cracking down on big landlords who use antitrust laws — who break antitrust laws by price-fixing and driving up rents.”
On an Atlanta campaign visit on Friday, presidential candidate Cornel West followed up on Biden’s criticism of corporate landlords, calling their concentrated homebuying tactics “organized greed.”
The left-wing academic, who’s running via his newly formed Justice for All Party, told Atlanta Civic Circle in an interview that “taxing the rich” would be a step in the right direction, even though it seems “impossible to tax the rich, because they bring in these lawyers that are so clever, they create loopholes as big as the Mississippi River.”
“You’ve got to set in place some very powerful mechanisms of accountability,” West said. “Regulation is too weak, because [corporations] can just buy off the regulators. You’ve got to criminalize the greed that goes beyond the law.”
Biden’s proposed use of antitrust laws to crack down on corporate landlords would particularly impact metro Atlanta, where Wall Street and private equity investors have been snapping up homes at breakneck pace — fueling skyrocketing rents and pricing many would-be homebuyers out of the market. Just three corporate landlords own upwards of 19,000 houses in the five-county metro area, accounting for nearly 11% of the single-family rental market, according to a new study from Georgia State University and Rutgers University researchers.
Congressional legislation introduced in 2022 by U.S. Sen. Jeff Merkley (D-Oregon) sought to cap at 100 the number of single-family homes a corporate entity can buy. But the bill, which would have fined firms that skirted the regulation, never made it off the Senate floor.
Deirdre Oakley, a GSU sociology professor who studies housing, said it will take nothing short of a “miracle” to rein in the influence of Wall Street and private equity investors on housing markets, especially in metro Atlanta.
Increased taxation “maybe” helps, she said, “but we live in a capitalist country,” so the odds of that happening are low. The real estate lobby — and other lobbyists for wealthy corporations and people — is robust enough to stunt politicians’ bid for higher taxes, she added. (Biden said during his speech, “I’m a capitalist. If you want to … you can make a million or millions of bucks. That’s great. Just pay your fair share in taxes.”)
Expanding housing supply is a must
The National Apartment Association, which represents landlords controlling over 12 million apartments globally, called Biden’s criticism of corporations misplaced and instead advocated for expanding the housing supply to bring prices down.
“While we are pleased that housing policy is meaningfully in the spotlight for the first time in generations, the president’s misguided blame only serves to further divide us, instead of solving the problems at hand: a critical shortage of housing supply and soaring costs across the board,” the organization said in a statement.
Oakley agreed that boosting the housing stock is a key component to fostering affordability — but that alone, she said, will not make Atlanta affordable for lower income people. Leaving housing production to the free market will not produce housing affordable to lower income people, because of the high cost of labor, land, and materials in booming metro areas like Atlanta.
Ahead of the president’s annual address, the Center for Popular Democracy, a progressive advocacy group, urged the Biden administration to invest $1 trillion in social housing over 10 years “to create over 12 million high-quality, permanently and deeply affordable, green homes that are publicly owned or under democratic community control.” It also suggested the president create an Office of Social Housing under the umbrella of the U.S. Department of Housing and Urban Development.
Biden did propose some new policies to make homeownership more accessible during his address — namely, a generous tax credit.
“I want to provide an annual tax credit that will give Americans $400 a month for the next two years as mortgage rates come down, to put toward their mortgage when they buy a first home or trade up for a little more space,” he said. “And my administration is also eliminating title insurance on federally backed mortgages. When you refinance your home, you can save $1,000 or more as a consequence.”
Informative article, the proposal of the president at the last paragraph will make a progressive change if it is executed.