Grand jury should investigate Florida housing market manipulation, Crist says

U.S. Rep. Charlie Crist lays the blame for Florida’s lack of affordable housing on two things: Wall Street investors and Gov. Ron DeSantis.

Crist, a Democrat running for governor, on Thursday released his proposal to address Florida’s housing crisis that focuses on curbing the influence of large real estate investment firms he says are buying up housing stock in Florida neighborhoods and driving up rent prices.

“We’re in an affordability crisis like I’ve never seen,” Crist said in an interview with the Tampa Bay Times. He called large investment firms “vultures” that prey on tenants, homebuyers and the housing market.

Under the plan, Crist would direct an appointed state “housing czar” to assist local governments in bringing down home prices. Those efforts could include setting limits on the number of single-family rental properties an investment firm can own in a given market and taxing properties purchased by investors and left vacant.

He said he’d also call for a grand jury to investigate what he sees as illegal and anti-competitive market manipulation, but did not detail further what that investigation could entail.

Investors have been raising rents and outbidding prospective homebuyers in the Tampa area and in markets across Florida, driving up prices and eating away at the housing supply. That burden has fallen disproportionately on low-income and minority neighborhoods, Crist said.

A spokesperson for Crist pointed to recent reports in certain Florida markets that as many as one in four single-family homes are owned by investment companies. Experts say that high concentration of investors can make bidding for homes more difficult for regular homebuyers using mortgages.

Crist’s plan would raise the documentary stamp tax on real estate transactions for “large, out-of-state” firms purchasing single-family homes — a move he says would make it more expensive for investors trying to buy and convert Florida homes into rental properties. That tax revenue would in turn fund the state’s Sadowski funds for affordable housing, he said.

He criticized DeSantis for not taking stronger action against Wall Street real estate investors and not working with the federal government to bring down prices.

“Those that are trying to profit unfairly on the backs of everyday Floridians would end up having to pay their fair share,” Crist said.

Lindsey Curnutte, a DeSantis campaign spokesperson, said in an emailed statement that Crist should look to the leaders of his own party if he wants to blame someone for housing prices.

“It’s no secret [President] Joe Biden has made living more expensive for Americans everywhere. Democrats’ inflationary policies are increasing the cost of everything, but Governor DeSantis has prepared the state of Florida to make sure that, if Biden plunges the U.S. into a recession, Florida has a cushion with this year’s fiscal surplus,” Curnutte said. “We recommend Florida Democrats call on the leader of their party to fix the fiscal mess the President has gotten us into.”

Competition from institutional investors converting homes into rental properties, along with a flood of new residents from more expensive cities like New York, has priced some Tampa-area residents out of their communities, said Pinellas County Commissioner Rene Flowers, who voiced support for Crist’s platform.

“It’s a delicate balance, not trying to hurt individuals who are doing the right thing and who are going above and beyond and providing safe, clean and affordable housing,” Flowers said. “But we want to draw attention to those who are not doing that.”

Crist’s “Wall Street Crackdown Plan” is an extension of his Affordable Florida for All policy platform, which he announced in January. That platform also includes measures aimed at lowering property and auto insurance, as well as reforming Florida’s Public Service Commission, which Crist said has been too quick to approve utility rate hikes.

Florida Agricultural Commissioner Nikki Fried, Crist’s most prominent Democratic primary opponent in the governor’s race, has unveiled a similar plan to bring down housing prices. Fried’s plan includes expanding the homestead exemption on property taxes, declaring a housing state of emergency and “exploring innovative ideas” such as converting empty hotels into affordable housing units.

Crist declined to comment on specific facets of Fried’s plan but said he appreciates that she, unlike DeSantis, is prioritizing housing affordability.

“I’m not going to critique a fellow Democrat,” Crist said. “I’ve got an opponent that I’m concerned about, and he’s the guy that’s in the mansion right now.”