Predatory real estate investors could be fined or jailed under new city ruleAtlanta City Hall. Credit: Kelly Jordan
By Sean Keenan
Predatory real estate investors in Atlanta have officially been put on notice: If they badger people about selling their homes, especially if those homeowners don’t want to, they could be fined or locked up.
On Monday, the Atlanta City Council approved legislation that cracks down on what’s now called “commercial harassment,” making it a city-level offense punishable by fines of up to $1,000 or six months in jail.
The legislation was crafted in response to an investigative series by WABE and APM reports into the practice of “equity theft,” which occurs when investors coax property owners into selling their homes for less than their worth, essentially robbing them of the chance to build wealth from their houses.
The new rule bars investors from repeatedly pestering people about selling their places if those people have asked the solicitors to leave them alone.
An investor would be in violation of the law if they practice “predatory tactics,” which are defined in the legislation as “repeated and unsolicited attempts, within any 180-day period, to contact a person or entity, including via personal visits, or written material or similar means under circumstances where the person or entity has affirmatively requested the defendant or the defendant’s agent to refrain from such activity.”
Although the ordinance could help reduce the frequency with which investors try to swindle people out of their properties, it’s not the be-all, end-all for those predatory tactics, said Georgia State University urban studies professor Dan Immergluck.
“I do not think it should be viewed as sufficient to end the equity theft practice, though it can help discourage it,” he said in an email to SaportaReport. “What is also needed is a law that requires investors to present to homeowners a current third-party valuation from a reputable valuation firm such as Zillow.”
That way, the logic goes, the seller would have an idea of if the wool is being pulled over their eyes.
(Header image, via Kelly Jordan: Atlanta City Hall)