Land contracts in the Mahoning Valley

Staff report

YOUNGSTOWN

There were more than 47,000 land contracts in Ohio between January 2008 and January 2018, according to a report released Friday and written by Policy Matters Ohio researcher Victoria Jackson.

The report documents the growing prevalence of land contracts in Ohio and their concentration in the Mahoning Valley, one of the areas hardest hit by predatory home sellers.

“Unscrupulous speculators use land contracts to foist the costs of home-ownership onto buyers without actually selling them anything. Buyers, meanwhile, retain none of the protections of a conventional mortgage,” Jackson said. “Land contracts combine the worst parts of renting a home with the worst parts of buying one.”

Land-installment contracts were once a tool for speculators to exploit minority and poor families barred from access to traditional mortgages, and have made a resurgence in Ohio since the foreclosure crisis.

Under these arrangements, buyers accrue zero equity in their home until the entire cost, plus interest, taxes, liens and fees, are paid in full.

Buyers who fail to keep up with payments can be removed from their home, forfeiting all investments they’ve made.

The report is available at policymattersohio.org/research-policy/pathways-out-of-poverty/consumer-protection-asset-building/predatory-land-contracts-strip-wealth-from-communities.