Real estate investing is fundamentally about creating value. But that value doesn’t have to come at the expense of residents, neighborhoods, or the environment.
In fact, ethical real estate investments can support more sustainable growth while avoiding some of the risks associated with less scrupulous investment practices.
Ethical real estate investing considers the broader impact of an investment alongside its raw financial potential. Instead of focusing exclusively on maximizing returns, ethical investors look for opportunities to improve properties, increase housing supply, support communities, and use resources responsibly for lasting gains.
Here at Gatsby Investment, we’re committed to ethical real estate investing that benefits investors, communities, and future generations. Here are a few ways we pursue strong returns for our investors while making a positive impact.
1. Create New Housing Inventory
Los Angeles has been in a housing shortage for decades. This has reduced affordability to the point of limiting in-migration and even causing some residents to leave (although the LA Exodus was largely exaggerated).
Creating new housing inventory eases the supply-and-demand imbalance that inflates housing prices to the point of actually restricting economic growth.
Gatsby has proudly contributed to increasing housing inventory by:
- Developing new multi-family properties in high-demand neighborhoods
- Adding accessory dwelling units (ADUs) to single-family house flips
- Making our development system available to homeowners who are rebuilding after the wildfires
Rather than contributing to housing scarcity, we’re looking to help increase inventory so that Angelenos can afford to continue living in LA and contributing to our local economy, which benefits the entire region.
2. Consider the Community
Real estate investments don't exist in isolation. Development and redevelopment projects can influence traffic, employment, local businesses, housing availability, neighborhood character, and quality of life.
Ethical investors consider these effects when evaluating opportunities. This might mean preserving useful community features, improving neglected spaces, incorporating accessibility into project design, or working with local stakeholders to understand what an area actually needs.
For example, Gatsby’s multi-family development strategy focuses on gentle density that respects the character and needs of a neighborhood. Rather than building invasive structures with hundreds of units in residential areas, we prefer unobtrusive projects with 4 to 10 units. These structures can fold more easily into established neighborhoods while limiting any impact on traffic patterns, existing aesthetics, or the environment.
3. Consistently Look to Add Value
While some lots are best suited to removing existing structures in distress and developing a new building, that’s not always the case. Sometimes, improving existing homes can create value for investors and the eventual renters or buyers.
Renovating aging single-family and multi-family buildings, for example, can provide residents with safer, more comfortable homes.
And, while Gatsby prioritizes residential investments, there are also ethical opportunities in adding value to commercial and industrial real estate. Rehabbing neglected commercial properties can attract businesses and jobs. And converting obsolete buildings into useful structures can help communities make better use of existing space.
4. Incorporate Sustainable Building Practices
Real estate has environmental impacts throughout a property's life cycle, from the materials and energy used during construction to the resources required for ongoing operation.
Sustainable building practices can help reduce those impacts. Depending on the project, investors and developers might incorporate:
- Energy-efficient appliances and HVAC systems
- Improved insulation
- Water-saving fixtures
- Renewable energy
- Durable materials
- Fire-resistant features
These improvements may increase upfront costs, but they can also increase profitability potential. We might benefit directly from holding a property with lower maintenance and utility expenses. Or we might benefit from commanding a higher sales price to investor buyers who are willing to pay more for a property with lower long-term operating costs.
Either way, this is a win for investors, future owners, and the environment.
5. Practice Responsible Property Management
Ethical real estate investing extends beyond the purchase, development, or renovation of a property. How the property is operated can also affect residents, tenants, and the surrounding community.
Responsible management can include:
- Keeping properties safe and well-maintained
- Responding promptly to necessary repairs
- Being honest and transparent with tenants
- Handling rent increases, lease terms, and other policies fairly
These practices benefit investors as well as tenants. Well-maintained properties may retain their value better, and positive tenant experiences can increase resident retention and reduce expensive vacancies.
If you’re not managing the ongoing day-to-day operations yourself, choose an experienced property manager who shares these priorities to benefit from ethical property management.
How to Ethically Invest in Real Estate with Gatsby Investment
If you value ethical behavior and strong return potential, consider investing with Gatsby Investment.
We offer real estate syndication projects with low investment minimums, passive returns, and a proven track record of success.
Explore our available investment opportunities to find the project(s) that most closely align with your investment timeline and financial goals. Each deal is professionally and ethically managed by Gatsby, with investor updates at every step of the process.
Ethics and profits are not mutually exclusive. Invest with experienced professionals who repeatedly demonstrate that you can have both!