If you sell a house these days, the buyer might be a pension fund • Hacker News Board

Re: If you sell a house these days, the buyer might be a pension fund

#191

Post by erikerikson » Wed, Jun 09, 2021, 4:26 PM UTC

davidw wrote: post #125

Here's why investors buy up houses: they know your neighbors will do the dirty work of artificially constraining the housing supply, which makes it a good investment. Here's one who comes right out and explains this: > Meanwhile, local opposition to building is so commonplace and the approval process so cumbersome, time consuming, and expensive, even when a proposed project complies entirely with requirements, approv…

Not only investment but also as a safe holding of value or shadow banking unit of account. Once you get enough money there's no safe place to keep it. While banks are relatively low friction, real estate ownership is like an account with the state, "guaranteed" by our attachment to the structure of our society and the government's "monopoly" on legitimate violence.

Re: If you sell a house these days, the buyer might be a pension fund

#192

Post by mech422 » Wed, Jun 09, 2021, 4:26 PM UTC

world_peace42 wrote: post #168

cortesoft wrote: post #151

Earlier quoted context omitted.

If you think that was disturbing, check out the substack linked to the twitter account. Full on nut job.

I clicked it. Looks like he's a Republican and a Christian (and has pretty standard opinions for that intersection) who likes to write long political essays. Are you sure he's a nut job, or could you possibly just be a bigot?

I clicked it, read some of it.. I think he's all 3

Re: If you sell a house these days, the buyer might be a pension fund

#193

Post by dragonwriter » Wed, Jun 09, 2021, 4:26 PM UTC

adflux wrote: post #98

em-bee wrote: post #91

Earlier quoted context omitted.

i am confused by your first sentence. what do non-homeowners sell?

Some people say "Well, you're paying more but you can also sell it for more afterwards". But non-homeowners are still paying more for less. That's the argument I am trying to make (poorly)

> Some people say "Well, you're paying more but you can also sell it for more afterwards".

No, they don’t, even talking about non-homeowners, because non-homeowners aren’t paying that much more (rents aren’t increasing the way purchase prices are, the rstio between them is increasing), and non-homeowners have nothing to sell, unless you are referring to subleasing as selling.

> But non-homeowners are still paying more for less.

I think you mean “first-time homebuyers”, but that just means it is more attractive to invest elsewhere while renting than jump into personal home ownership. No one is losing anything, certain choices are just becoming less favored.

Re: If you sell a house these days, the buyer might be a pension fund

#194

Post by JKCalhoun » Wed, Jun 09, 2021, 4:26 PM UTC

commandlinefan wrote: post #4

This hurts people who already own houses, too - property taxes are assessed on the appraised value of the home, which is a function of what the similarly-sized houses in your area sold for most recently. My property taxes have increased 10% every year for the past several years (and it would have been more if not for a legislative 10% annual cap). I worry that there will come a day when I've paid off my mortgage but…

> My property taxes have increased 10% every year for the past several years

How I know you don't live in California.

You would love Prop 13 then that has capped the amount that property taxes can increase per year.

Be careful though, your public schools and other services paid for by property taxes are going to suffer as the cash flow dries up....

Re: If you sell a house these days, the buyer might be a pension fund

#195

Post by stagger87 » Wed, Jun 09, 2021, 4:26 PM UTC

tptacek wrote: post #118

As has been pointed out repeatedly, this has the net effect transferring homes from owners to renters, which does not directly impact access or affordability; the housing stock remains available.

Do you think people should be able to buy affordable homes? Isn't affordability affected when you are competing with companies with deep pockets? When those companies need ROI do you think they will prioritize housing affordability over profitability?

Re: If you sell a house these days, the buyer might be a pension fund

#196

Post by kami8845 » Wed, Jun 09, 2021, 4:26 PM UTC

bityard wrote: post #145

A.k.a. The Carvana model. This is what Carvana and other "no-haggle, no-test-drive" startups are doing with the whole used car market in many areas. They aggresively buy up all the used cars in an area (or at least as many as they can) from dealerships and private sellers in order to make themselves the only entity with used cars for sale. Which they happen to be selling at 20% above true market value. But hey, you c…

In which areas does Carvana own all the cars for sale?

Re: If you sell a house these days, the buyer might be a pension fund

#197

Post by fighterpilot » Wed, Jun 09, 2021, 4:26 PM UTC

snikeris wrote: post #41

cosmojg wrote: post #32

If only so many people didn't treat land and houses like investments, there wouldn't be such a disastrous hoarding problem. Henry George's Land Value Tax [1][2] seems like an obvious economic fix that would require a large fraction of the population to change how they think about land and natural resources, but most of them are invested in such a way (i.e. owning multiple houses on multiple parcels of land, often wit…

I already pay a Land Value Tax to my town.

It's a Property Tax which is significantly worse than a Land Value Tax.

Firstly it encourages urban sprawl, which is bad for the environment and bad for cost of living and housing access.

Secondly it penalizes productive value add. Build something beautiful and you're punished for doing so.

Thirdly it doesn't have the same logical justification as the Land Value Tax, which is to tax ownership of scarce, zero sum, excludable, naturally occurring resources that aren't the product of labor.

Re: If you sell a house these days, the buyer might be a pension fund

#198

Post by throw737858 » Wed, Jun 09, 2021, 4:27 PM UTC

Cerium wrote: post #144

whoisburbansky wrote: post #132

Earlier quoted context omitted.

Something like this would effectively bar any person born in India who tried to immigrate to the U.S. in the last ~5 years from ever buying a house, unless they got married to a citizen. Broad strokes, I agree that residency requirements might help with reducing speculative investment, but maybe phrased in terms of how long you're in the country, not literally permanent residency as a legal threshold.

Not necessarily - for example in China foreigners are limited to owning one house. That limits speculation but does not provide hindrance for someone honestly trying to live.

In China nobody owns a house, it is just leased from government for 70 years.

Re: If you sell a house these days, the buyer might be a pension fund

#199

Post by redleader55 » Wed, Jun 09, 2021, 4:27 PM UTC

tachyonbeam wrote: post #77

cosmojg wrote: post #32

If only so many people didn't treat land and houses like investments, there wouldn't be such a disastrous hoarding problem. Henry George's Land Value Tax [1][2] seems like an obvious economic fix that would require a large fraction of the population to change how they think about land and natural resources, but most of them are invested in such a way (i.e. owning multiple houses on multiple parcels of land, often wit…

I agree that we need to stop treating houses as investments, because they're a basic fundamental need everyone has. IMO, the problem could be fixed by having stricter laws prohibiting people who aren't residents from owning homes in another country. The requirement to become a resident is only to live in a country for over 6 months out of the year. Before that, you can just rent. We could also do things like limit th…

Do you think the problem with money printing by governments is that people own houses in another country?

Re: If you sell a house these days, the buyer might be a pension fund

#200

Post by etempleton » Wed, Jun 09, 2021, 4:27 PM UTC

In my neighborhood the bank owns a house and has owned it since it was foreclosed upon about three years ago. The house is completely falling apart. It is unlivable. The house is tarpped. Apparently also filled with mold. The yard has rotting wood and weeds that are taller than my head. And no one will do anything about it.

The city will fine the bank $100 for each infraction and that is it. The bank could care less.

I am not sure of the bank’s end goal, but I suspect they are waiting for it to be a total loss, get insurance money, and then sell the property as land, which is worth now about what they paid for it anyway.

Meanwhile the local housing market is extremely supply constrained with houses going for over listing price and yet, the bank is not listing it because they think they can get more if they let it fall apart.