UVM research to House committee: investor cash and large down payments, not lack of supply, explain Burlington price gains

A University of Vermont researcher told the House Committee on General & Housing on May 7 that investor activity and big down payments, not a simple shortage of housing units, explain much of Burlington’s rise in single‑family home prices.

Joe Amant, a UVM professor, summarized a 20‑year review of Burlington single‑ and two‑family sales and closing documents. He said purchases by buyers listed as LLCs or corporations rose from about 1 percent of sales in 2003 to roughly 20–23 percent in 2023 and that many buyers—investor and non‑investor alike—are making substantially larger down payments than in earlier years. "As investors increase in the market... prices are rising," Amant said, adding that investors can bid higher because large cash or down‑payment positions reduce mortgage‑related risks.

The study’s key finding, Amant said, is how investor presence interacts with down‑payment behavior. By bringing more cash to bids, investors and well‑funded individual buyers can win sales quickly, making listings less effective at moderating price. Amant told the committee that, in his model, the price effect of removing one investor can be equivalent to building multiple homes—but only if those additional homes remain on the market for more than about 30 days. "We don't actually see the mediating supply effect on price until a home sits on the market for more than 30 days," he said.

Committee members asked about the study’s definition of "investor." Amant said his conservative rule classified a purchaser as an investor when the closing document listed the buyer as an LLC, Corp, Inc or Co; trusts and some nonprofit buyers were excluded. He acknowledged this likely undercounts investors who use individual names or shell companies and said his team is researching repeat‑buyer patterns and the use of multiple LLCs by the same operator.

Members also questioned whether noninstitutional cash buyers—people relocating with large proceeds from a prior sale—produce similar effects. Amant said the interaction term in his model captures the broader marketplace trend: when down payments and investor presence rise together, prices tend to increase, regardless of whether the buyer is an institutional owner or a wealthy individual.

Amant challenged the assumption that adding supply alone will reduce prices in Burlington. He reviewed recent construction data showing many new units have high assessed values and often reflect market‑rate, luxury or high‑end development rather than low‑cost homes targeted to local incomes. "What we're building... are $900,000 single‑family homes, $600,000 duplexes and luxury apartments," he told the committee, and added these units do not, by themselves, make housing affordable for lower‑income residents.

He also presented state‑level household and migration figures and questioned some of the assumptions underlying a widely cited Vermont Housing Finance Agency (VHFA) modeling scenario. Amant said VHFA’s demand projections rely on assumed immigration rates that, if revised with more recent out‑migration numbers, could materially change statewide housing‑need estimates.

The committee discussed policy responses, including a bill introduced by a member (H607) that would impose a waiting period or other limits to give resident buyers priority ahead of institutional buyers. A sponsoring member described H607 as a study and starting point for debate; Amant said his Burlington data show few large institutional repeat buyers but acknowledged shell companies complicate definitive identification.

Members raised affordability and homelessness concerns that Amant’s price‑versus‑supply analysis does not directly resolve. He emphasized that a jurisdiction can have vacant or sufficient units yet still have unhoused people if incomes and allocations do not match available stock. "It means we have a population who's unable to afford the homes that we do have," he said.

Committee chair closed by thanking Amant and suggesting follow‑up testimony from state economists and the Department of Taxes to assess whether earlier projections should be recalculated in light of recent migration data.

Next steps: members agreed to consider further testimony and analysis; no formal committee action or vote took place during this hearing.