Investors bought 27% of US homes in Q1, as traditional buyers struggle to afford
(abcnews.go.com)230 points by MilnerRoute 3 days ago
230 points by MilnerRoute 3 days ago
> For other readers: greenie_beans does not understand what LVT is, how it works
Personal attacks and shaming like this are unacceptable and it set off a hellish flamewar that you perpetuated. Please don't do this again. If you wouldn't mind reviewing https://news.ycombinator.com/newsguidelines.html and taking the intended spirit of the site more to heart, we'd be grateful.
We detached this subthread from https://news.ycombinator.com/item?id=44556051 and marked it off topic.
You are not a three month old account. You should know that personal attacks are against the site rules. You are way over the line here.
i'm very well aware. i'm just responding to what i was given. condescend to me without contending with my ideas then i'll roast. "good hackers break rules" - paul graham, probably
There should be no such thing as single family zoning.
Outlaw corporations from owning single family homes.
"Mom-and-pop investors, or those who own between 1 and 5 homes, account for 85% of all investor-owned residential properties, while those with between 6 and 10 properties account for another 5%
Institutional investors that own 1,000 or more homes account for only about 2.2% of all investor-owned homes, the firm said.
And that number could get smaller, amid signs that large institutional investors are scaling back home purchases.
Out of a group of eight of the biggest companies that own and lease single-family houses, including Invitation Homes and American Homes 4 Rent, six sold more homes in the second quarter than they bought, according to data from Parcl Labs."
Exactly why would single family homes receive this odd policy preference? Is the only reason that you couldn't do it at all with multifamily housing (the vast, overwhelming majority of which aren't co-ops, themselves corporations but not the kind you mean)? In which case all you're really doing here is flailing?
Except the builders who build them right? And the banks that lend against them? And the quasi governmental corporations who buy those loans?
If you want to make it so no homes get built at all your proposal seems like a good starting point.
Financial engineering is why people are poor. They are literally competing for goods and services with investment firms.
Meritocracy looks a bit different when individuals standing alone are expected to go toe to toe with multi-industry corporate conglomerates and their franchisees.
Don't more than 27% of Americans rent rather than own the housing they live in? It appears 36% rent. Doesn't this mean that the share of owner-occupied housing is going down, not up as the headline implies and readers are assuming?
You can’t extrapolate anything about owner occupancy rate broadly from this stat because it’s about who _bought_ in a short period.
If 28% of sellers that quarter were investors then the owner occupancy rate went up.
Now I suspect that’s not the case but if you look at home ownership rates for non-investors they stay in a very tight couple of % points in the mid 60s and they track interest rates. This has been true since the US started making home ownership a governmental priority post ww2.
Prior to that it was in the 40s for as far back as I could find any data.
I would expect investors to sell houses quicker than owner occupiers. Yes, some investors hold for a while, but there are enough that flip homes within months that I expect their average to be fairly low.
I can't vouch for what readers are assuming, but the headline is intended to say that more people are renting because more homes are going to institutions who don't occupy them.
The implication is that this drives up the price for renters, because the demand side includes not just money from people seeking a place to live, but much larger amounts of money from other markets.
If those homes had been purchased by an owner occupiers, then there would be that many fewer homes for rent, causing rent to go up.
The implication of these article is always that investors are somehow unfairly competing against homeowners. But there is only one fixed pool of people competing for housing - something that reduces supply for buyers is increasing it for tenants and vice versa.
If 27% of new homes are purchased by investors and 36% of old homes are owned by investors, then math says that this lowers the percentage of homes owned by investors. (27% * x + 36% * y) / (x + y) -> a number between 27 and 36.
It's only a 5-year high. Do they not have data before 2020? I need data over a much longer timeframe than 5 years to determine how interesting the 27% number is.
27% of homes sold, not 27% of US homes. The title is completely misleading.
Not a shocker, given high interest rates usually drive down prices, and investors are not getting mortgages. Great investment to keep value, not so much for growth.
> investors are not getting mortgages
I don’t know of any real estate investor who doesn’t use mortgages. The norm is interest-only mortgages and not paying down principal at all.
Zillow and the likes flipping homes should raise the number too?
But anyway, the trend of corparations buying houses is really bad.
The article says that institutional investing (1000+ homes) is decreasing.
> Institutional investors that own 1,000 or more homes account for only about 2.2% of all investor-owned homes, the firm said.
> And that number could get smaller, amid signs that large institutional investors are scaling back home purchases.
Zillow lost a lot of money trying to flip houses a few years ago and stopped.
Strangely, there's a ton of vacant commercial real estate in my neighborhood that the corporate landlords don't seem to be in any rush to rent out.
Not true.
Do a google search for "rent-fixing algorithms".
If you own enough homes in a rental market, you can determine the market rate. An empty house has value simply by depleting local housing stock, since it is giving you greater leverage to drive market rate up.
Of course its less value than actually having it rented, but its still value. Tax code will also allow for softening the loss.
> If you own enough homes in a rental market, you can determine the market rate.
Only if the government has managed to prevent new construction.
Consider this: You aim to buy all 100 units, and then you can charge whatever rent you like, right? What happens is sellers discover you are doing this, and then raise their asking prices through the roof. The result is it costs you so much to get that monopoly that you cannot hope to be able to rent at a profit. Especially if it is possible to create new units for the purpose of selling at a high price to you. And it is possible, unless the government prevents new construction.
You cannot attain a monopoly unless there are major barriers to entry. In this case, it is government zoning that prevents new construction. In California, anyone can sue to block any new housing construction, bringing the construction market to a standstill and hence the highest home prices in the nation.
Depends on your definition of value. There are many investments structured in a way that mere ownership, as long as comps go up in the local market, will cause increases in value.
Don’t look down.
It’s also why the current admin seems really intent on bullying Powell into decreasing the fed rate - Trump and many of his friends are very exposed to real estate.
Of course it does. Many houses remain empty because PE firms buy them and hold out for rents locals cannot afford.
Rent control plays a role in that.
If rents are not allowed to rise, the landlord risks locking in a low rent for the indeterminate future. It's a better play to leave it vacant until the rents rise.
Rent control is simply a disaster.
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