Private Equity Firms Are Making America's Housing Shortage Worse, Democrats Say

Democrats lobbed fresh attacks on private equity firms Thursday, blaming the industry for driving up rental costs and contributing to America’s affordable housing shortage.

Investors that scooped up cheap properties following the 2008 financial crisis are renting them out at unfair prices and neglecting residents and the communities they live in, according to Sherrod Brown, chair of the Senate Banking Committee.

“Private equity is all about the quick buck – everyone else be damned,” Brown said at a hearing Thursday. “Private equity profits depend on squeezing every last nickel from workers and renters, without any kind of real investment in their employers or their communities.”

This week’s hearing on private equity’s role in the housing market is the latest effort by Democrats like Brown and Elizabeth Warren to clamp down on alternative-investment firms, which the lawmakers say often profit at the expense of vulnerable Americans. Earlier this week, Warren reintroduced a bill that would require companies to disclose more about their fees and performance, though the legislation faces long odds in a closely divided Congress.