On July 10, 2012, a California investment firm called American Homes 4 Rent paid $903,019 for 10 homes that had been foreclosed on in new subdivisions ringing Columbus. With that purchase, central Ohio's home-rental landscape changed. Suddenly, Wall Street became a player in the largely mom-and-pop, homegrown industry of rental homes.

On July 10, 2012, a California investment firm called American Homes 4 Rent paid $903,019 for 10 homes that had been foreclosed on in new subdivisions ringing Columbus. ???

With that purchase, central Ohio�s home-rental landscape changed. ????

Suddenly, Wall Street became a player in the largely mom-and-pop, homegrown industry of rental homes.

Since those first houses were purchased, American Homes and three other out-of-state investment funds have gobbled up almost 1,300 rental properties in the Columbus area. Almost overnight, they have become some of the biggest owners of Columbus-area homes.

They are buying houses in almost every price range and in every corner of central Ohio, from abandoned wrecks in Linden that cost a few thousand dollars to 10-year-old Powell McMansions valued at $300,000.

>> View our database of central Ohio homes purchased by big buyers

Some central Ohio subdivisions are dotted with homes owned by the firms. In the Winchester Highlands neighborhood of Canal Winchester, for example, American Homes 4 Rent owns 10 houses, including three in a row on Fallon Lane.

�We�re buying as much as we can, as fast as we can,� said Joseph Nelson, chief executive officer of Mt. Helix Real Estate Investment Fund, who visited Columbus this week to review dozens of properties his San Diego firm owns.

�We, like some of the other investors, like this market. There�s a lot of available stock.�

The firms represent a daring Wall Street real-estate gamble that started in early 2012 when investment firms, lured by low home prices and high demand for rental homes, started buying individual homes on an unprecedented scale.

Led by New York-based Blackstone Group, whose houses are marketed as Invitation Homes, investment firms have now spent billions of dollars to buy an estimated 200,000 American homes.

�Brain trusts on Wall Street and several other people came to the similar conclusion that real estate was a great opportunity, especially single-family rentals, because of the low price of these properties,� said Daren Blomquist, vice president of the real-estate service RealtyTrac, which has documented the investor foray into single-family homes.

RealtyTrac estimates that investors accounted for almost 7 percent of the 25,000 single-family home sales in central Ohio last year.

That may be only the beginning. Investment funds have yet to tap central Ohio the way they have nearby cities. American Homes 4 Rent, which owns 728 central Ohio homes, owns about 2,000 in Indianapolis and 1,100 in Cincinnati.

American Homes 4 Rent and Silver Bay Realty Trust, a Minnesota company that owns 286 central Ohio homes, did not respond to requests for interviews. Both are publicly traded real-estate investment trusts.

Nelson said Mt. Helix, which now owns 64 Columbus homes, plans to buy up to 1,000 homes in the city.

�We�re gearing up for our big push this spring and summer,� he said.

The fourth investment firm to enter Columbus, Magnetar Capital, based in Evanston, Ill., leapt into the Columbus market in a single day in February 2013, when it bought 1,900 homes from the widow of Charles Huber, a Dayton-area real-estate developer. Among the homes were 184 Westerville- and Reynoldsburg-area rentals, as many as a dozen to a street.

Dan Bathon Jr., the chief executive officer with Magnetar�s managing partner, VineBrook Homes, said the company is looking to buy more homes in central Ohio.

Other firms also are looking to enter the game.

�I�m in conversations with three hedge funds actively interested in Columbus right now,� said Nathan Filia, broker with Golden Gate Real Estate in Lewis Center.

While Wall Street largely has embraced the enterprises because of the huge rental demand from families, some observers wonder whether companies can successfully oversee so many properties from afar, even with local managers.

�It remains to be seen how sustainable it is to manage thousands of properties in geographically diverse locations,� RealtyTrac�s Blomquist said.

Investors say they are renovating the homes as fast as they can to get them back into productive use.

�We�re looking for properties left behind by the recovery. They�re vacant and abandoned and in a state of disarray,� Nelson said. �The No. 1 goal is to get them back into use.�

Nelson estimates that Mt. Helix spends $10,000 to $20,000 rehabbing each of its Columbus properties.

Bathon said Magnetar has spent about $140,000 renovating 20 homes in the Westerville area, replacing furnaces, roofs, flooring, siding, downspouts and otherwise bringing the homes up-to-date.

�We�re doing a little bit of everything,� Bathon said. �I would expect, in the next five years, we will have renovated all of them.�

Bryan Rhoads, the administrator of Blendon Township, where Magnetar owns dozens of homes, said he�s pleased to see the company investing in the properties.

�In the past, when they were Huber Homes, we heard nothing but complaints from tenants,� Rhoads said. �They�ve been updating them, and Dan (Bathon) has personally come out and reached out to the community. I think he�s doing a great job.�

Like it or not, investment firms are now part of the rental landscape, said Rita Parise, Columbus� housing administrator.

�As difficult as it is to accept, we need to encourage investment from all sources to address the vacant- and abandoned-property issues in the city,� she said. �It would be great if we had all local folks doing it, but there are more vacant and abandoned properties than locals can manage."

Stephen Bevan, for one, is glad to see investors buy the houses. His home in the North Side neighborhood of Devonshire is flanked by two houses that sat empty until Silver Bay purchased them last year. One is being renovated and the other is newly occupied after repairs.

�They tore out cupboards, carpeting, cleaned them all up,� Bevan said. �It�s better than letting them fall apart.�

While some news accounts have criticized the way some investor-owned homes in other cities are managed, tenants interviewed by The Dispatch say the homes are well-maintained and the managers responsive.

�So far, everything�s excellent. We�ve never had any issues,� said Erin Mowrey, who, with a roommate, pays $900 for a three-bedroom ranch in Devonshire owned by Silver Bay.

Kia Cox, who lives in a three-bedroom home in the Winchester Highlands area of Canal Winchester, is satisfied with American Homes 4 Rent, although she liked the convenience of her previous landlord, who was local.

�They were right over on E. Broad, so if we had any issues, we could just go there. Now I have to call a toll-free number.�

When her heat stopped working one bitterly cold day a few weeks ago, Cox called the number. Within two hours, the problem had been fixed.

Cox�s only beef: She thinks her $1,195 rent is a little high, even though American Homes didn�t raise it when it took over the property.

�For as much as they charge, I feel like I should be in a five-bedroom house, but I understand everyone has to make a profit.�

Some observers worry about what will happen if the companies lose interest in being landlords.

�Our fear is that at some point, these institutional investors will exit the market,� said Sean Hinely, the owner of the Columbus firm RealEstatePros.com, which manages about 1,000 central Ohio rental homes. �When they all jump out, it will be another real-estate crash.�

For now, the companies say they are focused on getting the homes fixed and occupied, although they acknowledge that no one really knows what the future holds.

�If I had a crystal ball, I�d tell you exactly what we�re going to do in four or five years. But our best play is to keep all our options open,� Nelson said.

jweiker@dispatch.com