Uncovering racialized geographies: Investor strategies and the legacy of the 2008 financial crisis in Chicagoland

Abstract

The wreckage of the 2008 global financial crisis (GFC) led to long lasting changes in the single-family rental market. A variety of investors took advantage of the post-GFC environment, specializing in different segments of the distressed housing market. We examine two prominent companies’ activity in Chicagoland to explore how post-GFC investor purchases map onto a racialized geography that itself is a product of past housing policies and practices. National companies engaged in land contract sales and single-family rentals (SFR) targeted different sections of the foreclosure crisis that occurred during the broader GFC. While the SFR profit-strategy necessitates buying habitable properties that can attract tenants, predatory land contract sellers milk profit from distressed housing by offloading the risk (and cost) of homeownership to buyers. By exploring the geography of where the corporate landlord American Homes 4 Rent and land contract seller Harbour Portfolio purchased in the GFC’s aftermath we can better understand how the racialized nature of the U.S. housing market creates different pathways for profit and deepens racial-income inequities. American Homes 4 Rent targeted properties in higher income, whiter exurban regions of Chicagoland whereas Harbour Portfolio concentrated its activity in lower-income, majority-minority communities largely within the City of Chicago.