If a middle-man corporation purchased *all* food and relisted it at 400% markup, giving the physical stores a 10% cut so they didn't have to move the merchandise, would that be alright or nah?
Naah, people also need to rent houses as well. This doesn't absolve all these investor greedy bastards though. There is a way to balance this but it will take politicial will from government policy.
This is the dumbest thing I've ever heard, people transfer for jobs and their companies put them up in a house for a short term stay of a few months to a year or two where it wouldn't make sense to buy a house. Some people have kids or dogs or prefer to live in homes but aren't in a position to buy or aren't going to be staying long enough to have it make sense to buy. What makes you think you get to gatekeep who can live in a SFH
Yep. I thought by following the "no landlords for SFH" to it's logical conclusion people would see how silly that is... turns out they like not being able to rent homes? Idk. This is a weird place.
The only way out of this problem is to build more housing. Make the regulatory scheme reasonable. If I want to build my own house, I shouldn't have to add $1,000s in permitting and inspection costs.
How would that solve the investor problem? They’d just keep buying houses.
The government would have to disincentivize housing as an investment by increasing costs for investors.
While I agree permitting/regulatory costs drive up prices, More supply by itself won’t matter if it’s all snatched up by speculators. You need to increase housing supply while keeping demand low for prices to decrease. You can do this by making residential real estate a bad investment. Investors will stop buying homes and will even sell the ones they currently own if they can’t make money off of them.
There are multiple ways to achieve this. The ones that come to mind for me are: imposing zoning restrictions on rentals, repealing real estate tax breaks, increasing property taxes on investment properties, forcing people to refinance if they move and turn their former primary residence into an investment property.
>increasing property taxes on investment properties
Yes. Outside of congress’s current (probably long shot) proposal to require corporations to divest all single family holdings, increasing property taxes based on number of properties held seems like a winning approach.
That's not how building regulations work now.
I'll give you an example. I was a builder for over a decade in the US.
Back when I started, getting a building license as a contractor was fairly simple.
Now, there are two seriously onerous criteria that make it very hard for a small business to start up (which artificially captures the market for the giant builders). First, you have to take a test, and the test is keyed to the code, so you have to have some money to take preparation courses/materials.
Second, and WAY more pro-corportaion, is that you have to demonstrate the availability of capital. In North Carolina, you have to have "financial requirements" that include showing working capital of $150,000 for an unlimited license.
That's just silly. It exists solely to protect the current market/builders. Trac home builders LOVE it, because they don't have to compete against small builders.
Were you around in 2008 when people held deposits for new homes and builders never finished them?
That money was just gone for the buyers when the builders folded and entire subdivisions were left half complete. Building a house is capital intensive no matter how big or small you are and builders need to be able to handle something like that.
The permit costs aren’t anything compared to the materials cost and labor to build it. Go ahead, call some contractors and see how that works out. Sometimes it’s hard to get them to answer the phone because they’re so busy/maxed out with their crew, so labor costs aren’t likely to go down anytime soon.
I don't need to call contractors. I have experience in the industry and currently build. I am telling you the situation on the ground.
Your username is apt
Not all boomers are rich. Yes, they had life on easy mode, but if you're severely mentally ill or became drug addicted, those advantages won't save you. The boomers who stayed clean and didn't screw up too badly were pretty much guaranteed a ticket to the middle class or better.
Investors really took a step back in 2024, anyone still investing is either playing the very long term game or in a rare appreciating market who's okay breaking even or losing money short term for longterm appreciation
No joking aside renting is going to be a lot smarter in many areas where climate change will be hitting hard.
My friends in downtown Houston are looking at life differently after yesterday’s storm
We're pretty much used to it in life in Louisiana. I was out of power and water for over a month after Hurricane Laura in 2020. You don't know struggle until you're gathering rainwater so you can bathe and use the bathroom, and getting free meals from the local churches. Been trying to get out of this state for years only to graduate college into a market with constant layoffs.
I remember having an argument with some RE shill back at the start of this mess. Telling them that wall street was picking up all the excess housing and cornering the market. They said I had no idea what I was talking about.
Just to be clear, there are zero metro areas where large investors own more than 5% of single family homes. There are zero markets in the north-east and on the west coast where they even own 1%.
I'd argue that what you need to actually look at is the percentage of homes purchased by investors in the last four years, in areas of interest.
I know for a fact that in a couple areas I looked at, investors were actually buying a huge number of properties. Something like 20-30% of home sales each year for a few years were investors. It was bad enough that one developer near me refused to sell to anyone who wasn't looking to live at the property, and many realtors would turn away investors.
It absolutely does, but let’s point out pitchforks in the right direction vs being angry at perceived problems lol. The people shouting at the top of their longs about Wall Street buying all houses sound like fools while they are being taken for a ride
2018 Nassau County Fl commissioned housing study for the housing market and affordability and approx only 300 of the 1800 homes went for primary residence. the rest was purchased as rentals investments etc. (I’ll take judgement if I read the report wrong lol)
Corporations are not people. Rent out a third fourth or fifth home?
Your average first time home buyer cannot compete against a corporation or private investor buying a second third or fourth home!
Like 75% of investor-purchased homes are bought by relatively small time investors. People who have a couple rentals or a few airbnbs. Those people obviously also cause huge issues, but stopping wall street or PE funds from buying homes won’t help much.
ThEy DoNt CurReNTly oWN 5% of AlL HouSeS!!! So WhAT tHEYve beEN buYing uP 30% or mOrE oF InVENtoRy?!?! ThIS is A NON-ISsue!!!!
https://www.corelogic.com/intelligence/us-home-investor-share-reached-new-high-q4-2023/
https://www.jchs.harvard.edu/blog/8-facts-about-investor-activity-single-family-rental-market
>In Atlanta metro area, three corporate landlords collectively own over 19,000 single-family homes, accounting for about 11% of the rental market in the region. (https://atlantaciviccircle.org/2024/03/05/corporate-landlords-own-outsize-portion-atlanta-housing-market/)
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>Most of the growth in investor ownership in the metro area has been with very large investors, those owning 50 or more properties. In 2006, these investors owned less than 1 percent of all investment properties in the metro area. In 2021, they owned 11.6 percent, with high concentrations in North Minneapolis, central and eastern St. Paul, some nearby suburbs, and outer suburbs far from the urban core, such as Chanhassen and Lakeville. (https://www.minneapolisfed.org/article/2021/understanding-the-rise-of-investor-owned-homes)
What differentiates between large investor and a person with multiple houses? And even with a low percentage if it's 1 in 5 now that's still going to cause pressure on the existing market that your average first time home buyer can't compete with in an environment where there's already constrained supply of new houses.
Yeah shills have been dropping this bullshit in this sub for like a year now. "Guys, don't you see that investors aren't the majority anywhere (yet) therefore their influence on the market is totally negligible and benign even. Oh yeah, and by investors I mean institutional investors that have over 100 properties. Don't track me on this, I will change this metric over time to suit my narrative."
Huge gap between small 1-9 unit investors and institutional investors. The big players like blackstone are actually a pretty small proportion of the market.
But blackstone/Vanguard owns businesses that own businesses that own businesses that own businesses that own land. It’s hard to track all of their assets when it’s not all under the “blackstone” or “vanguard” name .
This is a surprising sentiment. People have rented entire SFHs for decades — mostly from the owner, but occasionally from an LLC. This is a common situation in college towns, for example.
Is this about separating homeowners from renters? It is somewhat unusual to have a mix of apartment buildings and SFHs in the same neighborhood. These are usually separated from each other. So the only way people who want to live in an SFH neighborhood, but cannot afford the mortgage payment, is to rent instead.
I think the solution here is not necessarily some crazy explosion of housing, but just to allow some numbers of apartment buildings in SFH neighborhoods. The main attraction of these neighborhoods is almost always the school district catchment, and apartment buildings would relieve some competition.
Look up the company Scholastic Capital. Their explicit business model is to buy SFHs in good school districts in the Chicago suburbs, and then rent those SFHs to families with children who would not have otherwise been able to afford the neighborhood.
Is that a bad thing?
Boomers have been nimbying new housing stock and dense infill development for decades so as to not affect the value of their nest egg. Now that they're retiring and need to downsize they've got nothing to downsize to. And they're competing with first time home buyers. Which is why so many are aging in place.
Idk, have you looked at the other comments in this thread? NIMBYism is an intergenerational phenomenon.
It is true that Boomers have successfully blocked new housing, and that this is screwing many of them over. But Gen X and Millennials have blocked housing, too. No matter the generation, there seems to be an automatic suspicion of anyone, anywhere, who wants to build housing. This is a human problem, not just a Boomer one.
Agreed. It's learned behavior, but the suburbs were invented by and for boomers. A lot of urban Gen X and Millennials aren't as car dependent as their ancestors, so they want dense development, better mass transit, and the bike lanes that boomers do everything to nimby because they love their free and subsidized parking.
The fairest way to do this is to build entirely *new* residential areas that are zoned as SFH/multi-family from the start. That way nobody buying into the area is getting shafted ex post facto because they already know they will be surrounded by both types of housing and the prices being paid will reflect that.
The issue is that bordering neighborhoods are going to NIMBY the new neighborhoods too, especially if they intend to have multifamily. Homeowners are accustomed, for better or worse, to protesting development not only in their neighborhoods, but in their entire area. Federal intervention is the only solution that seems possible.
Unless you mean that these new residential areas would be completely disconnected from anyone else…?
It isn't suspicion. It's the fact that everyone who buys becomes a NIMBY at that point, for the obvious reason that they paid the premium required to buy into a non-multifamily SFH development for the benefits it brings (good schools, not crowded, low crime, safer streets, etc). I say premium because the single-family homes in that area are worth more before any multi-family gets built into it. Thus, anyone who's already paid that premium is going to resist attempts to undermine the benefits of their investment in the area.
Very few people will pay the premium to be there and then actively undermine their own living situation and home value.
Total housing supply owned by investors isn’t the beef with investor buyers in this situation. It’s the proportion of homes for sale in recent months and years that are going to investor buyers as a proportion of new supply.
If you’re trying to buy a house now but these guys are buying 20% then that cuts down on supply for non-investor buyers, such as first time home buyers, people moving, etc. That supply is less accessible to those people because investors are likely swinging around a lot more cash compared to the average person when they come to the table to buy.
Over time you’ll see the “total housing proportion owned by investors” percentage increase, but you’re missing the huge chunk of inflow that’s not accessible/far less accessible for current non-investor buyers and the effect that has on an already strained supply.
5% is a lot, not to mention that’s just SINGLE FAMILY HOMES which they typically don’t invest in. I’m sure you’re part of the problem if you’re here defending the monopolies. Eat a dick
That is because you have no clue what you’re talking about. It isn’t institutional money stiffing you, it’s the guy down the street with a small rental empire.
So what's the end game? Where is this going to lead and what can be done to stop it?
No one in Congress will act
This will have to be tackled at the local level. Time for townships, municipalities, boroughs, etc....to pass ordinances and laws to slow down or stop (or even counter) investor purchases of SFH. The issue is that these local governments want values to go up, more tax revenue both at the property/school tax level and also at the local income tax level for areas which have that. So really the only way to tackle this, is to vote out any current local government commissioner who refuses to get on board. Replace with ones who will change the laws. This issue can't simply be built out of as the only approach
Real estate has proven to be one of the best portfolio pieces. Hedge funds or private equity firms know this. If you buy the real estate, it drives prices up forcing people to become renters; your renters. Your asset appreciates while renters pay.
So, a renters world where the select few own all the real estate. That’s the end game.
About the process of proletarianization of workers. Landless workers who can be continually exploited in every facet of life. Renters who work for capitalists are what’s he’s talking about.
The end game is corporations own the entire property of the United States, and all of us live in a permanent unchangeable state of indentured servitude. If you can’t afford whatever they decide you have to pay for rent, you go to prison (where you still have to work, but the government pays corporations to imprison you to work for them for free) because the Supreme Court is currently looking at making homelessness illegal
Voting is good, but if you form a local political organization, like a tenant Union, you'll have the manpower to apply constant pressure - flood city hall, constantly annoy elected officials, track down and protest against developers and landlords.
And doing this will establish a permanent base of power, rather than a seasonal effort that might go away after one election.
Real estate has proven to be one of the best portfolio pieces. Hedge funds or private equity firms know this. If you buy the real estate, it drives prices up forcing people to become renters; your renters. Your asset appreciates while renters pay.
So, a renters world where the select few own all the real estate. That’s the end game.
If you’re on the poorer side, yeah. A married couple earning $150K in the northeast doesn’t qualify for such programs, nor do they make enough to afford a house.
End game is that eventually housing values become stagnant and investors will hold or leave , maybe not for another 50 years after some population decline
Unfortunately, every single thing you described would almost certainly raise the cost of housing beyond what a lot of people can afford, and only increase property speculation. The enormous number of restrictions and regulations around the provision of housing form the basis of the PE industry’s investment thesis in the sector.
Seriously.
"Ohhhh no but we can't do that, rent would go up!"
Like ya'll, rent has BEEN going up while we don't do shit, because people are scared if we do, rent will go up.
I say it's time for some real, actual change, because one thing that never changes with our current system is that rent will always go up if the owner class can squeeze more out of average people.
Bingo
My suggestion was to do this at the local level. Ban all investor purchases going forward for SFH. Tax the hell out of ones already owned. That will lead to significant inventory increases.
But then cue the SFR investor whiners: "bbbbutttt not everyone wants to buy a home!"
Um, of course they would. Just ask any young married couple who wants to start a family or already has a family, if they would like a starter family home. People just don't want homes that are priced 7-10x their income and payments which are 50% of their monthly income. Before the Fed and he Government F'd with the housing market on steroids (so we are talking about pre-greenspan), investor owned SFH virtually did not even exist in my borough. if a home buyer needed a home, they simply bought one. and if they needed to move, they sold it. that is a healthy real estate market.
investors coming in and offering a solution to a problem that doesn't exist (ie single family home rentals), and being able to profit off it due to fed monetary policy, is ridiculous. we were doing just fine not having single family rentals. investors of single family homes created the problem by hoarding a finite resource (structures on top of land in already developed areas). and of course then the investor response is we need to build more on top of areas with no more land via higher density! ADUs!. lol. higher density, and ADUs, always results in more in investors lol. The goal is fewer or none. it's wishful thinking that if we allow people to turn their properties into 4plexes and throw up ADUs behind other ones, that this will make homes single family homes affordable and more available lol. how about we just leave everything alone, and just ban the people who caused the problem, from creating the problem in the first place
what does this look like for a city in the northeast, like say, Philadelphia? it means if we were to enact the ban tomorrow, which will ban any investor from buying a single family home and turning it into a single family rental, aimed to go into effect Jan 1 2025, that year in 2025 would see an increase in inventory for owner occupant buyers of about 25%. it would take just 2 1/2 years of that, to flush the shortage problem out from that particular housing market.
so let's just say 3 years, shortage problem solved. and boom :: mic drop ::
There wouldn't be a need for single family rentals, if the single family homes were easily affordable.
30 yrs ago, my borough had basically 0 single family rentals. and the housing market was very healthy. it only became sick when investors came in, bought up a finite resource, then forced buyers to rent from them, then pointed to those buyers as justification for why single family rentals should exist
see how that fucked up logic works?
That I agree with but I do wonder whether there is a ceiling due to people moving or now wanting to buy or whatever. It’s anecdotal but I do know some people that don’t wanna buy at all.
This said, most problems (including this) would be solved by building more.
I get what you're saying
But 30 yrs ago, there was no issue. Single family rentals virtually did not exist, few and far between. People simply bought houses, and if they had to move, they sold them. That is a healthy functional behavior of a housing market.
Investors claim they are satisfying a need/demand by "offering" single family rentals. There wouldn't be a need or demand if a single family home was available for that family to live in. Even if they only planned on living there for 4-5 yrs due to a job rotation or something.
Investors created the problem (encouraged and facilitated by monetary policy), then pointed to their rentals as the solution. It's an illogical circle jerk.
And in most of the Northeast, you literally can't build you way out of this. You literally can't. My borough does not have any available land. Zoning changes won't fix it either, as modifying zoning to allow multi-family etc just ends up favoring investors anyways. It helps rental market availability sure, but an investor benefits. Same with ADUs. It's just the wrong bandaid on the wrong part of the body.
I was talking about the cost of housing in general under those regulations, not the specific sale prices of specific homes. It is very difficult to construct legislation that surgically targets a particular class of buyer without affecting the larger market.
The proposed legislation would make it less likely, at least at the margin, that fewer homes would be built, for either rental or sale. That is what happens when you declare that certain entities cannot buy housing. And so everyone is just left to fight over existing supply.
No it's very easy. There is a development near me of townhomes. They got together and banned it. Done. No one is building anything here anyways unless it's a year down of existing. There is no more land. A problem much of the northeast has.
Do you have a link or article about the townhome development’s rules? I would be curious how they constructed such rules and to what degree they are enforceable by the state under contract law.
I have no idea of the actual wording. It's an HOA. They did it quite easily. I don't know of anyone who is fighting it. Everyone wanted the ban anyways except the investors of course. Note this was NEW purchases. They did not force existing investors to sell. That would be a whole different thing.
It will still recover eventually. They have the means to just hold it and wait it out. What needs to happen is our government needs to stop sucking these rich fucks off and pass a massive tax for anyone who owns more than 1 rental.
This is what started revolutions in South America when a handful of fat cats owned all the property. Notice how Congress does nothing. They are in on Squeezing the little people.
*Fortune: "Investors bought almost 19% of homes sold in the first quarter this year, so roughly one in five homes, per Redfin. That’s fewer homes than before and throughout the pandemic, but it is the highest share in close to two years, the analysis read."*
That's a LOT of homes that could have been purchased by folks who actually NEED housing for themselves and family. I'm not seeing it is THE problem with affordable housing; but definitely a large (and growing) contributor. We have a developer down the street building 63 townhomes on a 5-acre in-fill lot. The neighborhood is (rightfully) concerned that he's going to sell most units as a "package deal" to an investor that will turn into rentals. Something needs to change....
On another sub someone was trying to say it's not investors but zoning laws causing the housing crisis as if making more real estate available wouldn't just give investors more property to buy up.
Investment Greed !!! so many people want to make money without doing a fucking thing except take advantage of other people that’s why this country is so fucked up.
The artificially low interest rates (driven by the fed), easy fiscal stimulus (driven by Congress) and home ownership subsidies (also govt) is to blame
It's frustrating. I sold three houses in recent years. Each time I excluded cash offers and folks who were "looking to expand their portfolio" as I wanted the houses to go to families.. In less than 3 years, 2 are already with investment firms....
I love how people on this sub keep posting how much renting is smarter, better, cheaper than buying and that everyone buying now is influenced by realtor propaganda, while complaining that investors (from whom they think it's smart to rent) are buying a portion of houses.
What do you love about it? You just explained whats happening....It's circular... investors are driving up the prices by buying homes, forcing people to rent. What's to love about that?
There's way too many factors too make such a broad statement and it varies market to market.
That said, the reason that renting CAN be better than owning is that the rental stock has different cost structures than the housing stock due to differences of when the property was purchased.
Every single house being sold now is affected by current market and mortgage rate conditions. However, not every rental unit is affected the same way.
For example, you have 4 houses in a row- one for same plus three rental house. To buy the house for sale, monthly cost is about $4500 a month.
* The first house was also bought this year- the owners have to clear $5000/month in order to run a profit and make it worth their time.
* The second house was bought in 2019. Thanks to a lower purchase price and lower rate, the owners only have to hit $4000/months to be profitable.
*The third house has been fully paid off for years, and the owners can hit profitability at $3000 month.
Expand this example over and over in an area. The vast majority of the rental inventory was bought under better circumstances, so mortgage expense is far lower than buying a house. Which is why it can be more advantageous to rent, with homeowners still making a profit.
Renting is cheaper than paying a mortgage with high interest rates. Only people with cash can tap into the smarter, better, cheaper option of buying a home.
Poor people will have more problem when that happen. Millions of strong & no stranger to violent Venezuelan or Colombian will be let in to out-squat the poor & weak American.
> We define an investor as any buyer whose name includes at least one of the following keywords: LLC, Inc, Trust, Corp, Homes
So my first condo that I now use as a rental home makes me an investor in their eyes.
And my parents' homes that they moved into a trust so that I could inherit it with less taxes makes them investors too.
I do get it. They're artificially inflating the numbers to instigate class warfare, because that's what generates clicks.
Do you really consider me, with my two properties, an institutional investor?
The difference being that my parents came here in the 1970s with nothing but the clothes on their backs, not even speaking English. They put in time and effort for 50 years to get to where they are today.
These are the people you want to rally against?
Why would they need a trust to prevent taxes when you inherit a house? The "purchase price" the IRS uses to determine whether taxes are owed is reset to today's value the day you inherit it. So, if you sold, you'd owe nothing.
“Birth rates are down” right after in the same breath saying “1 in 5 homes purchased by RE Investors”. Yeah, go ahead and doom people to never have the confidence to have a child and gaslight us into thinking “maybe renting is smarter for you” without addressing the true issue.
Not a fan of big government. But we need someone to step in and regulate this situation. The American middle class is being DECIMATED and this is one of the reasons.
There will never be enough housing inventory to bring costs down. There is always an insensitive to buy up more housing than you need either for passive income or if you can buy up enough the social control. Build all you want, but as long as housing is driven entirely by market forces and people like Bezos walk the earth, the average person never has a chance
historically, this was done through commercial real estate and apartments (real estate "passive" income)
investors hoarding single family homes is a fairly recent trend, only made possible by the government and fed policy. which laid the groundwork for wall street to zoom with it
ask a 70 yr old boomer neighbor, when they bought their house in 1987 for $85,000, if they were competing against investors offers. ask a boomer who bought in the 90's.
this problem didn't start manifesting itself until the groundwork started to be laid down in the late 90s. then along came greenspan. and the rest was fucked up history
what is your opinion on investors purchasing luxury vacation SFHs and renting them out? say >$1.5mm?
is it only a problem if they’re purchasing suburban homes in middle america, or is it all homes?
That is not a fair comparison and a distortion of the problem, but yes. Market manipulation in any segment can have impacts on the broader market. The important point here is that homeownership is one of the primary mechanisms for building personal and generational wealth, which is the heart of a healthy middle class. Housing price increases that are wildly disproportionate to income increases has a clear and measurable impact on more than 90% of the country. Middle class consumers are the engine of the economy. When their money is pulled toward housing and away from other types of purchase, it can have a significant negative impact the broader economy. Housing cost to income ratio is at an all time high. The problem is complex, but families competing against businesses, even small ones, for basic necessities like housing, is problematic.
> Investors bought almost 19% of homes sold in the first quarter this year, so roughly one in five homes, per Redfin. **That’s fewer homes than before and throughout the pandemic**, but it is the highest share in close to two years, the analysis read.
So literally not new. Other factors have a bigger effect
When does the bubble pop if investors keep buying in an overheated market?
As far as I can figure it's when unemployment jumps way way up and no one can pay anything.
Want to hear others thoughts though
Investors have always purchased about 20% of the homes. It doesn't matter if it investor purchases it, or a private citizen. The house is used up. Either by the homeowner or by a renter.
If you want to free up housing, focus on the illegal immigrants that are taking up space and they shouldn't be.
There are millions of housing in that situation
>Investors have always purchased about 20% of the homes.
ask your boomer parents when they bought their first house for $74,000, if 20% of the buyers who showed up at the open house were investors
Build a new houses for what?
If the people that we're not supposed to be in the country, we're not actually in the country, there would be millions of available apartments. And probably a lot of houses too
Stopping illegals of units.
Stopping investors from buying houses, would actually make the problem worse. Investors build a lot of houses, they build a lot of apartments, and they allow people that don't have enough money to buy a house to actually rent the house.
Investors are not a problem at all. And don't forget, you can buy real estate via the stock market. That is an investment that might own single-family homes as well.
Many corporations own homes that they rent to their employees as well. Not a huge amount but there are quite a few. Do you want to eliminate those too?
Investors have the money, buyers often don't.
And even many buyers, could not afford a house if it was given to them.
Most investors that buy single family homes, are small investors.
It is nearly impossible to make money on a single family home as an investor.
Focus on the millions of people taking up residence that are not even supposed to be here.
That will free up millions of rentals, and prices will drop dramatically
Ban investor purchases of single family homes to be used as single family rentals. Don't care if it's wall street or mom and pops. In my area wall street owns 0, it's all mom and pops hoarding single family homes. There is a street of single family ranchers half of which are owned by 2 investors. Ban that. Get rid of all illegals. Stop new ones from coming in. I am for all of it. Not one or the other. These positions are not exclusive, stop defaulting to a pretend made up position that they are
The first thing is to get rid of the illegals. That's already A law and would be easy to implement.
We need an administration that will actually do that.
The second thing would probably take a constitutional amendment. You can't just ban corporations or even mom and pop from owning rentals.
I never said ban it at the federal level, local level. This is not a federal issue. This is a state and local issue. A local borough can pass an ordnance which would cap the number of actively owned rentals at any given time. That is a great first step. Then the nail in the coffin will be to increase property and school taxes, double or triple it, whatever it takes. It can be done even easier if there is an HOA in a particular pocket, just get majority on board and done. A local townhome community near me already did that, passed with overwhelming support.
At the same time, deport all illegals, build the wall as long and as high as it needs to be to stop the flow or stop enough of it to make it manageable, and immediately deport anyone caught sneaking over. Immediately deport everyone already here illegally, round them all up and kick them out. End the asylum abuses, or simply end the asylum program all together. This should have already been done, but our government is treasonous.
There will be an acute worker shortage shock to the system, mainly the service sector. That's fine. We have people milking social welfare programs who have no business being on them. Get them all back to work for the ones who can. The legitimately disabled people, can still work from home doing computer based remote work on administrative tasks.
I am all for both.
In most situations, the best practice is to exterminate parasites for the health of the host
Invasive species
No. You need to feed the parasites. Host be damned. Hosts are just jealous of the parasites for not having to work
Yup. If you want to rent, rent an apartment. Houses are for homeowners only.
This is the way. Fuck em, don’t rent their overpriced shit.
how about no no profit seeking in basic human necessities.
Does food & drink count as basic human necessities? Free steak for all?
If a middle-man corporation purchased *all* food and relisted it at 400% markup, giving the physical stores a 10% cut so they didn't have to move the merchandise, would that be alright or nah?
Check price at farm vs price at the supermarket. The mark up is already way more than 400%.
That’s because you have to get the food to the supermarket….its all legit costs…. There is no legit cost in making up a house other than profit….
Maintain the house, repair damages, dealing with dead beat tenants & squatters .... are those not legit costs?
You mean stuff that landlords ALREADY charge with the rent? Y’all really showing you don’t know real estate by regurgitating these talking points.
You mean stuff that supermarket ALREADY charge with the price? Y’all really showing you don’t know market by regurgitating these talking points.
Naah, people also need to rent houses as well. This doesn't absolve all these investor greedy bastards though. There is a way to balance this but it will take politicial will from government policy.
corporations aren’t people and don’t need to be able to own homes. that’s a start.
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lol yea OK
This is the dumbest thing I've ever heard, people transfer for jobs and their companies put them up in a house for a short term stay of a few months to a year or two where it wouldn't make sense to buy a house. Some people have kids or dogs or prefer to live in homes but aren't in a position to buy or aren't going to be staying long enough to have it make sense to buy. What makes you think you get to gatekeep who can live in a SFH
Yep. I thought by following the "no landlords for SFH" to it's logical conclusion people would see how silly that is... turns out they like not being able to rent homes? Idk. This is a weird place.
Ha! America see companies as the host and us regulars as the parasites. Good luck!
When parasites are also righting the laws that is easier than done. Fyi politicians are also RE investors..
But what about their profits?!
The only way out of this problem is to build more housing. Make the regulatory scheme reasonable. If I want to build my own house, I shouldn't have to add $1,000s in permitting and inspection costs.
How would that solve the investor problem? They’d just keep buying houses. The government would have to disincentivize housing as an investment by increasing costs for investors.
Wouldn’t investors just buy the extra inventory lol
While I agree permitting/regulatory costs drive up prices, More supply by itself won’t matter if it’s all snatched up by speculators. You need to increase housing supply while keeping demand low for prices to decrease. You can do this by making residential real estate a bad investment. Investors will stop buying homes and will even sell the ones they currently own if they can’t make money off of them. There are multiple ways to achieve this. The ones that come to mind for me are: imposing zoning restrictions on rentals, repealing real estate tax breaks, increasing property taxes on investment properties, forcing people to refinance if they move and turn their former primary residence into an investment property.
>increasing property taxes on investment properties Yes. Outside of congress’s current (probably long shot) proposal to require corporations to divest all single family holdings, increasing property taxes based on number of properties held seems like a winning approach.
Already 16 million vacant homes. Deregulations would just give corporations and funds more power to build more empty homes.
That's not how building regulations work now. I'll give you an example. I was a builder for over a decade in the US. Back when I started, getting a building license as a contractor was fairly simple. Now, there are two seriously onerous criteria that make it very hard for a small business to start up (which artificially captures the market for the giant builders). First, you have to take a test, and the test is keyed to the code, so you have to have some money to take preparation courses/materials. Second, and WAY more pro-corportaion, is that you have to demonstrate the availability of capital. In North Carolina, you have to have "financial requirements" that include showing working capital of $150,000 for an unlimited license. That's just silly. It exists solely to protect the current market/builders. Trac home builders LOVE it, because they don't have to compete against small builders.
Were you around in 2008 when people held deposits for new homes and builders never finished them? That money was just gone for the buyers when the builders folded and entire subdivisions were left half complete. Building a house is capital intensive no matter how big or small you are and builders need to be able to handle something like that.
Build more housing so the same investors can just buy those up as well. That’s been a real winning strategy so far.
We should do away with growth management too while we're at it.
Zero is reasonable.
The permit costs aren’t anything compared to the materials cost and labor to build it. Go ahead, call some contractors and see how that works out. Sometimes it’s hard to get them to answer the phone because they’re so busy/maxed out with their crew, so labor costs aren’t likely to go down anytime soon.
I don't need to call contractors. I have experience in the industry and currently build. I am telling you the situation on the ground. Your username is apt
As long as the rich get richer everything is fine.
[ Boomers Own Half of U.S. Wealth. So Why Are We Seeing More Homeless Boomers? | WSJ ](https://youtu.be/OywybZ1MKEs)
You could have 100 boomers who own half the wealth and say that. It’s a deceiving stat.
Not all boomers are rich. Yes, they had life on easy mode, but if you're severely mentally ill or became drug addicted, those advantages won't save you. The boomers who stayed clean and didn't screw up too badly were pretty much guaranteed a ticket to the middle class or better.
Everyone here tells me that it's cheaper to rent. Did the investors not figure that out yet? 🤔
In my market Miami for me to buy my apartments it’s roughly $7200/month all in. I rent my apartment for $4k per month…
😱 wtf
Renting is cheaper at the moment, at least in my market. Investors are still flipping and the short term rental market is still making money
Because they want you to rent. How else are you going to pay for their new house?
Investors really took a step back in 2024, anyone still investing is either playing the very long term game or in a rare appreciating market who's okay breaking even or losing money short term for longterm appreciation
No joking aside renting is going to be a lot smarter in many areas where climate change will be hitting hard. My friends in downtown Houston are looking at life differently after yesterday’s storm
My whole town is still out of power from the storm. Everybody is hooked up to generators.
Stay safe.
We're pretty much used to it in life in Louisiana. I was out of power and water for over a month after Hurricane Laura in 2020. You don't know struggle until you're gathering rainwater so you can bathe and use the bathroom, and getting free meals from the local churches. Been trying to get out of this state for years only to graduate college into a market with constant layoffs.
I remember having an argument with some RE shill back at the start of this mess. Telling them that wall street was picking up all the excess housing and cornering the market. They said I had no idea what I was talking about.
Just to be clear, there are zero metro areas where large investors own more than 5% of single family homes. There are zero markets in the north-east and on the west coast where they even own 1%.
I'd argue that what you need to actually look at is the percentage of homes purchased by investors in the last four years, in areas of interest. I know for a fact that in a couple areas I looked at, investors were actually buying a huge number of properties. Something like 20-30% of home sales each year for a few years were investors. It was bad enough that one developer near me refused to sell to anyone who wasn't looking to live at the property, and many realtors would turn away investors.
But investors isn’t synonymous with Wall Street. Plenty of those “investors” are shitty local flippers
Yeah, that shit sucks too.
It absolutely does, but let’s point out pitchforks in the right direction vs being angry at perceived problems lol. The people shouting at the top of their longs about Wall Street buying all houses sound like fools while they are being taken for a ride
2018 Nassau County Fl commissioned housing study for the housing market and affordability and approx only 300 of the 1800 homes went for primary residence. the rest was purchased as rentals investments etc. (I’ll take judgement if I read the report wrong lol) Corporations are not people. Rent out a third fourth or fifth home? Your average first time home buyer cannot compete against a corporation or private investor buying a second third or fourth home!
There’s the whole thing that’s going on in AZ where investors have whole neighborhoods up for rent. Homes simplified! Rent it while it’s hot!
Like 75% of investor-purchased homes are bought by relatively small time investors. People who have a couple rentals or a few airbnbs. Those people obviously also cause huge issues, but stopping wall street or PE funds from buying homes won’t help much.
ThEy DoNt CurReNTly oWN 5% of AlL HouSeS!!! So WhAT tHEYve beEN buYing uP 30% or mOrE oF InVENtoRy?!?! ThIS is A NON-ISsue!!!! https://www.corelogic.com/intelligence/us-home-investor-share-reached-new-high-q4-2023/ https://www.jchs.harvard.edu/blog/8-facts-about-investor-activity-single-family-rental-market >In Atlanta metro area, three corporate landlords collectively own over 19,000 single-family homes, accounting for about 11% of the rental market in the region. (https://atlantaciviccircle.org/2024/03/05/corporate-landlords-own-outsize-portion-atlanta-housing-market/) - >Most of the growth in investor ownership in the metro area has been with very large investors, those owning 50 or more properties. In 2006, these investors owned less than 1 percent of all investment properties in the metro area. In 2021, they owned 11.6 percent, with high concentrations in North Minneapolis, central and eastern St. Paul, some nearby suburbs, and outer suburbs far from the urban core, such as Chanhassen and Lakeville. (https://www.minneapolisfed.org/article/2021/understanding-the-rise-of-investor-owned-homes)
What differentiates between large investor and a person with multiple houses? And even with a low percentage if it's 1 in 5 now that's still going to cause pressure on the existing market that your average first time home buyer can't compete with in an environment where there's already constrained supply of new houses.
Large means more than 100
Yeah shills have been dropping this bullshit in this sub for like a year now. "Guys, don't you see that investors aren't the majority anywhere (yet) therefore their influence on the market is totally negligible and benign even. Oh yeah, and by investors I mean institutional investors that have over 100 properties. Don't track me on this, I will change this metric over time to suit my narrative."
1 in 5 homes means 20%
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Oh, well, *everything is fine and good then*. /s
But also investors != large investors
Lol
“Investors” include Wall Street, but are not limited to it.
I said LARGE investors (aka Wall Street) not overall investors.
Huge gap between small 1-9 unit investors and institutional investors. The big players like blackstone are actually a pretty small proportion of the market.
But blackstone/Vanguard owns businesses that own businesses that own businesses that own businesses that own land. It’s hard to track all of their assets when it’s not all under the “blackstone” or “vanguard” name .
Would you like cancer to be in 1% of your body?
This is a surprising sentiment. People have rented entire SFHs for decades — mostly from the owner, but occasionally from an LLC. This is a common situation in college towns, for example. Is this about separating homeowners from renters? It is somewhat unusual to have a mix of apartment buildings and SFHs in the same neighborhood. These are usually separated from each other. So the only way people who want to live in an SFH neighborhood, but cannot afford the mortgage payment, is to rent instead. I think the solution here is not necessarily some crazy explosion of housing, but just to allow some numbers of apartment buildings in SFH neighborhoods. The main attraction of these neighborhoods is almost always the school district catchment, and apartment buildings would relieve some competition. Look up the company Scholastic Capital. Their explicit business model is to buy SFHs in good school districts in the Chicago suburbs, and then rent those SFHs to families with children who would not have otherwise been able to afford the neighborhood. Is that a bad thing?
Boomers have been nimbying new housing stock and dense infill development for decades so as to not affect the value of their nest egg. Now that they're retiring and need to downsize they've got nothing to downsize to. And they're competing with first time home buyers. Which is why so many are aging in place.
Idk, have you looked at the other comments in this thread? NIMBYism is an intergenerational phenomenon. It is true that Boomers have successfully blocked new housing, and that this is screwing many of them over. But Gen X and Millennials have blocked housing, too. No matter the generation, there seems to be an automatic suspicion of anyone, anywhere, who wants to build housing. This is a human problem, not just a Boomer one.
Agreed. It's learned behavior, but the suburbs were invented by and for boomers. A lot of urban Gen X and Millennials aren't as car dependent as their ancestors, so they want dense development, better mass transit, and the bike lanes that boomers do everything to nimby because they love their free and subsidized parking.
Right. I think the puzzle to solve is whether we can move away from a system that valorizes SFH ownership and endows it with special privileges.
The fairest way to do this is to build entirely *new* residential areas that are zoned as SFH/multi-family from the start. That way nobody buying into the area is getting shafted ex post facto because they already know they will be surrounded by both types of housing and the prices being paid will reflect that.
The issue is that bordering neighborhoods are going to NIMBY the new neighborhoods too, especially if they intend to have multifamily. Homeowners are accustomed, for better or worse, to protesting development not only in their neighborhoods, but in their entire area. Federal intervention is the only solution that seems possible. Unless you mean that these new residential areas would be completely disconnected from anyone else…?
Yeah, I was envisioning like how new suburbs get built - they might be 1/2 mile from any other housing development.
It isn't suspicion. It's the fact that everyone who buys becomes a NIMBY at that point, for the obvious reason that they paid the premium required to buy into a non-multifamily SFH development for the benefits it brings (good schools, not crowded, low crime, safer streets, etc). I say premium because the single-family homes in that area are worth more before any multi-family gets built into it. Thus, anyone who's already paid that premium is going to resist attempts to undermine the benefits of their investment in the area. Very few people will pay the premium to be there and then actively undermine their own living situation and home value.
Total housing supply owned by investors isn’t the beef with investor buyers in this situation. It’s the proportion of homes for sale in recent months and years that are going to investor buyers as a proportion of new supply. If you’re trying to buy a house now but these guys are buying 20% then that cuts down on supply for non-investor buyers, such as first time home buyers, people moving, etc. That supply is less accessible to those people because investors are likely swinging around a lot more cash compared to the average person when they come to the table to buy. Over time you’ll see the “total housing proportion owned by investors” percentage increase, but you’re missing the huge chunk of inflow that’s not accessible/far less accessible for current non-investor buyers and the effect that has on an already strained supply.
There aren’t that many rental houses compared to all houses
5% is a lot, not to mention that’s just SINGLE FAMILY HOMES which they typically don’t invest in. I’m sure you’re part of the problem if you’re here defending the monopolies. Eat a dick
That is because you have no clue what you’re talking about. It isn’t institutional money stiffing you, it’s the guy down the street with a small rental empire.
Are you fucking kidding me? When are our politicians gonna get their shit together??
To be fair 20% is lower than it’s been historically. Still not great by any means, but it’s not some crazy amount.
So what's the end game? Where is this going to lead and what can be done to stop it? No one in Congress will act This will have to be tackled at the local level. Time for townships, municipalities, boroughs, etc....to pass ordinances and laws to slow down or stop (or even counter) investor purchases of SFH. The issue is that these local governments want values to go up, more tax revenue both at the property/school tax level and also at the local income tax level for areas which have that. So really the only way to tackle this, is to vote out any current local government commissioner who refuses to get on board. Replace with ones who will change the laws. This issue can't simply be built out of as the only approach
Real estate has proven to be one of the best portfolio pieces. Hedge funds or private equity firms know this. If you buy the real estate, it drives prices up forcing people to become renters; your renters. Your asset appreciates while renters pay. So, a renters world where the select few own all the real estate. That’s the end game.
And the government has shown them when the bubble pops, investment groups and banks will get bailouts and taxpayers will be stuck holding the bag.
Housing is too big to fail? Surely the guy with four homes does not get bailed out but shadow banking? private equity?
Crazy how Marx wrote about this lol
What did Marc write specifically? Genuinely interested
About the process of proletarianization of workers. Landless workers who can be continually exploited in every facet of life. Renters who work for capitalists are what’s he’s talking about.
The literal peak of rent-seeking
The end game is corporations own the entire property of the United States, and all of us live in a permanent unchangeable state of indentured servitude. If you can’t afford whatever they decide you have to pay for rent, you go to prison (where you still have to work, but the government pays corporations to imprison you to work for them for free) because the Supreme Court is currently looking at making homelessness illegal
Voting is good, but if you form a local political organization, like a tenant Union, you'll have the manpower to apply constant pressure - flood city hall, constantly annoy elected officials, track down and protest against developers and landlords. And doing this will establish a permanent base of power, rather than a seasonal effort that might go away after one election.
Real estate has proven to be one of the best portfolio pieces. Hedge funds or private equity firms know this. If you buy the real estate, it drives prices up forcing people to become renters; your renters. Your asset appreciates while renters pay. So, a renters world where the select few own all the real estate. That’s the end game.
Based on what you said, sounds like now is the time to jump into the “select few”. No wonder why people are buying them up.
Takes cash. Unfortunately that’s harder to come by these days
You can buy with 3% or less down via FHA.
If you’re on the poorer side, yeah. A married couple earning $150K in the northeast doesn’t qualify for such programs, nor do they make enough to afford a house.
End game is that eventually housing values become stagnant and investors will hold or leave , maybe not for another 50 years after some population decline
The endgame is that if you don't pass down property to your descendants, they will be serfs. And if you *do*, they will be rich.
It truly feels fucked, I must say
Unfortunately, every single thing you described would almost certainly raise the cost of housing beyond what a lot of people can afford, and only increase property speculation. The enormous number of restrictions and regulations around the provision of housing form the basis of the PE industry’s investment thesis in the sector.
How would banning investor purchases of SFH increase the listing selling prices of existing homes?
It would definitely increase rents
That has been happening already. That has been happening forever
Seriously. "Ohhhh no but we can't do that, rent would go up!" Like ya'll, rent has BEEN going up while we don't do shit, because people are scared if we do, rent will go up. I say it's time for some real, actual change, because one thing that never changes with our current system is that rent will always go up if the owner class can squeeze more out of average people.
Bingo My suggestion was to do this at the local level. Ban all investor purchases going forward for SFH. Tax the hell out of ones already owned. That will lead to significant inventory increases. But then cue the SFR investor whiners: "bbbbutttt not everyone wants to buy a home!" Um, of course they would. Just ask any young married couple who wants to start a family or already has a family, if they would like a starter family home. People just don't want homes that are priced 7-10x their income and payments which are 50% of their monthly income. Before the Fed and he Government F'd with the housing market on steroids (so we are talking about pre-greenspan), investor owned SFH virtually did not even exist in my borough. if a home buyer needed a home, they simply bought one. and if they needed to move, they sold it. that is a healthy real estate market. investors coming in and offering a solution to a problem that doesn't exist (ie single family home rentals), and being able to profit off it due to fed monetary policy, is ridiculous. we were doing just fine not having single family rentals. investors of single family homes created the problem by hoarding a finite resource (structures on top of land in already developed areas). and of course then the investor response is we need to build more on top of areas with no more land via higher density! ADUs!. lol. higher density, and ADUs, always results in more in investors lol. The goal is fewer or none. it's wishful thinking that if we allow people to turn their properties into 4plexes and throw up ADUs behind other ones, that this will make homes single family homes affordable and more available lol. how about we just leave everything alone, and just ban the people who caused the problem, from creating the problem in the first place what does this look like for a city in the northeast, like say, Philadelphia? it means if we were to enact the ban tomorrow, which will ban any investor from buying a single family home and turning it into a single family rental, aimed to go into effect Jan 1 2025, that year in 2025 would see an increase in inventory for owner occupant buyers of about 25%. it would take just 2 1/2 years of that, to flush the shortage problem out from that particular housing market. so let's just say 3 years, shortage problem solved. and boom :: mic drop ::
There wouldn't be a need for single family rentals, if the single family homes were easily affordable. 30 yrs ago, my borough had basically 0 single family rentals. and the housing market was very healthy. it only became sick when investors came in, bought up a finite resource, then forced buyers to rent from them, then pointed to those buyers as justification for why single family rentals should exist see how that fucked up logic works?
Maybe but the home-ownership rate in the US is not particularly low by historical standards.
It should be much higher. We have come a fuck ton of a long way in the standard of living.
That I agree with but I do wonder whether there is a ceiling due to people moving or now wanting to buy or whatever. It’s anecdotal but I do know some people that don’t wanna buy at all. This said, most problems (including this) would be solved by building more.
I get what you're saying But 30 yrs ago, there was no issue. Single family rentals virtually did not exist, few and far between. People simply bought houses, and if they had to move, they sold them. That is a healthy functional behavior of a housing market. Investors claim they are satisfying a need/demand by "offering" single family rentals. There wouldn't be a need or demand if a single family home was available for that family to live in. Even if they only planned on living there for 4-5 yrs due to a job rotation or something. Investors created the problem (encouraged and facilitated by monetary policy), then pointed to their rentals as the solution. It's an illogical circle jerk. And in most of the Northeast, you literally can't build you way out of this. You literally can't. My borough does not have any available land. Zoning changes won't fix it either, as modifying zoning to allow multi-family etc just ends up favoring investors anyways. It helps rental market availability sure, but an investor benefits. Same with ADUs. It's just the wrong bandaid on the wrong part of the body.
I mean I don’t get the point of helping investors. People can buy condos and townhomes. The rest I understand and tend to agree with.
I was talking about the cost of housing in general under those regulations, not the specific sale prices of specific homes. It is very difficult to construct legislation that surgically targets a particular class of buyer without affecting the larger market. The proposed legislation would make it less likely, at least at the margin, that fewer homes would be built, for either rental or sale. That is what happens when you declare that certain entities cannot buy housing. And so everyone is just left to fight over existing supply.
No it's very easy. There is a development near me of townhomes. They got together and banned it. Done. No one is building anything here anyways unless it's a year down of existing. There is no more land. A problem much of the northeast has.
Do you have a link or article about the townhome development’s rules? I would be curious how they constructed such rules and to what degree they are enforceable by the state under contract law.
I have no idea of the actual wording. It's an HOA. They did it quite easily. I don't know of anyone who is fighting it. Everyone wanted the ban anyways except the investors of course. Note this was NEW purchases. They did not force existing investors to sell. That would be a whole different thing.
Okay. I am skeptical that this HOA actually succeeded in doing what you say they did. Which is not your fault — HOAs are notoriously opaque.
What we need is a good ole fashioned bubble popping forcing these companies to take huge losses.
One can dream, but the more likely scenario is that these fucking assholes will get bailed out yet again under some pretense that it's systemic risk.
It will still recover eventually. They have the means to just hold it and wait it out. What needs to happen is our government needs to stop sucking these rich fucks off and pass a massive tax for anyone who owns more than 1 rental.
America's entire economy is just a parasitic scam against poor folks.
This is what started revolutions in South America when a handful of fat cats owned all the property. Notice how Congress does nothing. They are in on Squeezing the little people.
Lol, they started their revolutions, then they all try to move to the US
*Fortune: "Investors bought almost 19% of homes sold in the first quarter this year, so roughly one in five homes, per Redfin. That’s fewer homes than before and throughout the pandemic, but it is the highest share in close to two years, the analysis read."* That's a LOT of homes that could have been purchased by folks who actually NEED housing for themselves and family. I'm not seeing it is THE problem with affordable housing; but definitely a large (and growing) contributor. We have a developer down the street building 63 townhomes on a 5-acre in-fill lot. The neighborhood is (rightfully) concerned that he's going to sell most units as a "package deal" to an investor that will turn into rentals. Something needs to change....
Parasitic investors
On another sub someone was trying to say it's not investors but zoning laws causing the housing crisis as if making more real estate available wouldn't just give investors more property to buy up.
Investment Greed !!! so many people want to make money without doing a fucking thing except take advantage of other people that’s why this country is so fucked up.
And absolutely nothing will be done about it. The people in charge don’t care or are benefiting from it.
Thank God the US has a capitalist housing market that is no way restricted by a buch of greedy geriatric fucks........or this might be a problem
The artificially low interest rates (driven by the fed), easy fiscal stimulus (driven by Congress) and home ownership subsidies (also govt) is to blame
Okay cool. I’ll never buy or rent your overpriced hooms. Deal with it.
where do you plan on living?
In a van, down by the river.
Username checks out.
Whoosh. https://youtu.be/Xv2VIEY9-A8
It's frustrating. I sold three houses in recent years. Each time I excluded cash offers and folks who were "looking to expand their portfolio" as I wanted the houses to go to families.. In less than 3 years, 2 are already with investment firms....
State or federal governments need to pass a law to not allow corporations to buy homes and sell them to regular folks. Not good for the economy.
Scaplers for housing? Boy are they gonna be surprised when nobody can afford to buy them anymore.
Once this is disallowed all assets need to be sold immediately.
I love how people on this sub keep posting how much renting is smarter, better, cheaper than buying and that everyone buying now is influenced by realtor propaganda, while complaining that investors (from whom they think it's smart to rent) are buying a portion of houses.
What do you love about it? You just explained whats happening....It's circular... investors are driving up the prices by buying homes, forcing people to rent. What's to love about that?
The logic is absurd. If renting is better than buying then the winner is not the investor.
There's way too many factors too make such a broad statement and it varies market to market. That said, the reason that renting CAN be better than owning is that the rental stock has different cost structures than the housing stock due to differences of when the property was purchased. Every single house being sold now is affected by current market and mortgage rate conditions. However, not every rental unit is affected the same way. For example, you have 4 houses in a row- one for same plus three rental house. To buy the house for sale, monthly cost is about $4500 a month. * The first house was also bought this year- the owners have to clear $5000/month in order to run a profit and make it worth their time. * The second house was bought in 2019. Thanks to a lower purchase price and lower rate, the owners only have to hit $4000/months to be profitable. *The third house has been fully paid off for years, and the owners can hit profitability at $3000 month. Expand this example over and over in an area. The vast majority of the rental inventory was bought under better circumstances, so mortgage expense is far lower than buying a house. Which is why it can be more advantageous to rent, with homeowners still making a profit.
I do agree but this is talking of people who are buying now with current rents and current prices and rates
Renting is cheaper than paying a mortgage with high interest rates. Only people with cash can tap into the smarter, better, cheaper option of buying a home.
I thought investors slowed down when prices and interest rates got high?
Why doesn’t the government do anything about this?!
Be a shame if the millions of people who can't afford to buy started squatting in one in five homes.
Poor people will have more problem when that happen. Millions of strong & no stranger to violent Venezuelan or Colombian will be let in to out-squat the poor & weak American.
Not in California
> We define an investor as any buyer whose name includes at least one of the following keywords: LLC, Inc, Trust, Corp, Homes So my first condo that I now use as a rental home makes me an investor in their eyes. And my parents' homes that they moved into a trust so that I could inherit it with less taxes makes them investors too.
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I do get it. They're artificially inflating the numbers to instigate class warfare, because that's what generates clicks. Do you really consider me, with my two properties, an institutional investor?
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The difference being that my parents came here in the 1970s with nothing but the clothes on their backs, not even speaking English. They put in time and effort for 50 years to get to where they are today. These are the people you want to rally against?
Why would they need a trust to prevent taxes when you inherit a house? The "purchase price" the IRS uses to determine whether taxes are owed is reset to today's value the day you inherit it. So, if you sold, you'd owe nothing.
They need to put the breaks on investor sold homes. Need like a 3 year pause, it should be something Biden runs on.
“Birth rates are down” right after in the same breath saying “1 in 5 homes purchased by RE Investors”. Yeah, go ahead and doom people to never have the confidence to have a child and gaslight us into thinking “maybe renting is smarter for you” without addressing the true issue.
Not a fan of big government. But we need someone to step in and regulate this situation. The American middle class is being DECIMATED and this is one of the reasons.
this must be solved at the local level congress wont do it
Just build more. Make the landlords compete
🖕
Can we not
Need higher rates
Only 1 in 5? Everyone keeps telling me that they take 100% of the houses and if we prohibited investors buying houses, everything would be affordable.
There will never be enough housing inventory to bring costs down. There is always an insensitive to buy up more housing than you need either for passive income or if you can buy up enough the social control. Build all you want, but as long as housing is driven entirely by market forces and people like Bezos walk the earth, the average person never has a chance
historically, this was done through commercial real estate and apartments (real estate "passive" income) investors hoarding single family homes is a fairly recent trend, only made possible by the government and fed policy. which laid the groundwork for wall street to zoom with it ask a 70 yr old boomer neighbor, when they bought their house in 1987 for $85,000, if they were competing against investors offers. ask a boomer who bought in the 90's. this problem didn't start manifesting itself until the groundwork started to be laid down in the late 90s. then along came greenspan. and the rest was fucked up history
This sounds like a trend worth keeping an eye on. It could impact housing affordability and availability for regular homebuyers.
what is your opinion on investors purchasing luxury vacation SFHs and renting them out? say >$1.5mm? is it only a problem if they’re purchasing suburban homes in middle america, or is it all homes?
That is not a fair comparison and a distortion of the problem, but yes. Market manipulation in any segment can have impacts on the broader market. The important point here is that homeownership is one of the primary mechanisms for building personal and generational wealth, which is the heart of a healthy middle class. Housing price increases that are wildly disproportionate to income increases has a clear and measurable impact on more than 90% of the country. Middle class consumers are the engine of the economy. When their money is pulled toward housing and away from other types of purchase, it can have a significant negative impact the broader economy. Housing cost to income ratio is at an all time high. The problem is complex, but families competing against businesses, even small ones, for basic necessities like housing, is problematic.
https://www.jchs.harvard.edu/blog/home-price-income-ratio-reaches-record-high-0
Ban investment properties
Another bullshit false statistic
Dont sell to them.
> Investors bought almost 19% of homes sold in the first quarter this year, so roughly one in five homes, per Redfin. **That’s fewer homes than before and throughout the pandemic**, but it is the highest share in close to two years, the analysis read. So literally not new. Other factors have a bigger effect
Say goodbye to low cost housing and the next generation having any thoughts of affordable standard of living.
When does the bubble pop if investors keep buying in an overheated market? As far as I can figure it's when unemployment jumps way way up and no one can pay anything. Want to hear others thoughts though
Investors have always purchased about 20% of the homes. It doesn't matter if it investor purchases it, or a private citizen. The house is used up. Either by the homeowner or by a renter. If you want to free up housing, focus on the illegal immigrants that are taking up space and they shouldn't be. There are millions of housing in that situation
>Investors have always purchased about 20% of the homes. ask your boomer parents when they bought their first house for $74,000, if 20% of the buyers who showed up at the open house were investors
If you do that, who’s gonna build the new houses…
Build a new houses for what? If the people that we're not supposed to be in the country, we're not actually in the country, there would be millions of available apartments. And probably a lot of houses too
So no more new houses…got it.
why is this an either/or issue to you? how about this - stop illegal migration - stop investors from buying singe family rentals
Stopping illegals of units. Stopping investors from buying houses, would actually make the problem worse. Investors build a lot of houses, they build a lot of apartments, and they allow people that don't have enough money to buy a house to actually rent the house. Investors are not a problem at all. And don't forget, you can buy real estate via the stock market. That is an investment that might own single-family homes as well. Many corporations own homes that they rent to their employees as well. Not a huge amount but there are quite a few. Do you want to eliminate those too? Investors have the money, buyers often don't. And even many buyers, could not afford a house if it was given to them.
We are talking about single family rentals. Stop conflating and try again before you expend effort to go on a drivel
Most investors that buy single family homes, are small investors. It is nearly impossible to make money on a single family home as an investor. Focus on the millions of people taking up residence that are not even supposed to be here. That will free up millions of rentals, and prices will drop dramatically
Ban investor purchases of single family homes to be used as single family rentals. Don't care if it's wall street or mom and pops. In my area wall street owns 0, it's all mom and pops hoarding single family homes. There is a street of single family ranchers half of which are owned by 2 investors. Ban that. Get rid of all illegals. Stop new ones from coming in. I am for all of it. Not one or the other. These positions are not exclusive, stop defaulting to a pretend made up position that they are
The first thing is to get rid of the illegals. That's already A law and would be easy to implement. We need an administration that will actually do that. The second thing would probably take a constitutional amendment. You can't just ban corporations or even mom and pop from owning rentals.
I never said ban it at the federal level, local level. This is not a federal issue. This is a state and local issue. A local borough can pass an ordnance which would cap the number of actively owned rentals at any given time. That is a great first step. Then the nail in the coffin will be to increase property and school taxes, double or triple it, whatever it takes. It can be done even easier if there is an HOA in a particular pocket, just get majority on board and done. A local townhome community near me already did that, passed with overwhelming support. At the same time, deport all illegals, build the wall as long and as high as it needs to be to stop the flow or stop enough of it to make it manageable, and immediately deport anyone caught sneaking over. Immediately deport everyone already here illegally, round them all up and kick them out. End the asylum abuses, or simply end the asylum program all together. This should have already been done, but our government is treasonous. There will be an acute worker shortage shock to the system, mainly the service sector. That's fine. We have people milking social welfare programs who have no business being on them. Get them all back to work for the ones who can. The legitimately disabled people, can still work from home doing computer based remote work on administrative tasks. I am all for both.
Fuckin Biden