G
overnor Kathy Hochul has been using populist tactics to distract from the real issue of insufficient housing supply in New York. She claims that institutional investors are driving up housing costs, but this claim is not supported by data.

    In reality, most single-family rentals are owned by small investors, and their share of home purchases has actually decreased over the past two years. According to Redfin, for every six homes purchased, investors bought one in the third quarter of 2024, a similar share to 2018 and 2019.

    Hochul's focus on scapegoating investors is a political strategy that ignores the root cause of high housing costs: a shortage of available homes. Her administration has not produced evidence to support her claims about institutional investors buying up housing supply in communities across New York.

    In fact, data shows that only about 3% of single-family rentals are owned by large investors, and they tend not to outbid individuals for homes. Investors typically look for fixer-uppers to rent or sell at a profit, while individuals prefer move-in condition homes.

    Hochul's proposal to hinder large investors' homebuying includes a 75-day waiting period before they can bid on a home listed for sale. However, this measure is based on false assumptions and ignores the symbiotic relationship between investors and individual buyers in the housing market.

    The governor's populist performance is a departure from her previous stance on why home prices are high: demand has outpaced supply. Pro-housing advocates cheered her sobering-reality narrative, but it was met with a political backlash that forced her to retreat. Now, she's using a boogeyman – private equity – and a feel-good pill to distract from the real issue of insufficient housing supply in New York.