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

#961

Post by CapricornNoble » Thu, Jun 10, 2021, 5:02 AM UTC

abeppu wrote: post #881

CapricornNoble wrote: post #865

Earlier quoted context omitted.

>>>Some prefectures are nearing 20% vacancy rates, but they're places like… well basically all of Shikoku which is largely mountainous and rural, and has been bleeding population at a rate of 5%/decade since 2000. That's crazy to me, Tokushima in Shikoku was on my short list of "ideal relocation spots". With just a few hours of scenic driving, you can be in Kochi, Takamatsu, Matsuyama, Okayama, or Wakayama. All with…

> So you could easily geographically distribute 4-5 girlfriends across those towns This comment took an unexpected turn. Why can you not have girlfriends in the same town?

You'd be surprised at how easily they can run into each other, or have overlapping social circles. It's a drama risk. Different cities that are hours apart is a "good enough" risk mitigation compromise short of dating women in different countries and flying them (or yourself) around regularly.

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

#962

Post by rhodozelia » Thu, Jun 10, 2021, 5:08 AM UTC

briefcomment wrote: post #85

recursive wrote: post #80

Earlier quoted context omitted.

I'd give up housing before food. There's a limit to how high that percentage can be.

The point is that landlords will be able to suck up the income that you spend on non-essentials and luxuries.

Only when demand exceeds supply and people have that extra income.

Edit: which is common in desirable places with lots of well paying jobs.

There are cheap places to rent and buy in the fly over states but not as much opportunity, hence the price

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

#963

Post by inspector-g » Thu, Jun 10, 2021, 5:21 AM UTC

ta1234567890 wrote: post #540

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…

And, at least in California, realtors will always push prices up. It’s pretty much never in their best interest to lower the price. Even the buyer’s agent gets paid a percentage of the sale price, so if they try to lower it they’d be essentially working against themselves. And this is without even accounting for all the schemes realtors create (like listing below market to get a lot of offers and create artificially…

I'd like to add my n=1 as a counterpoint to this.

I sold a house just before the pandemic struck. The realtor I chose, via a friend-of-friend connection, operated several agencies each with several agents; I would guess he had a few dozen people total working under him.

One thing quickly became apparent as we moved through the various processes involved in selling a home – he had his agencies and his agents optimize for volume. In the regions of CA where he operated, "throughput" was definitely not an issue, and so deliberately pricing homes low would cause them to sell faster and allow him / his agents to move onto the next client faster. Given the context, it seems clear to me this would yield more over the long term than fighting tooth and nail to drag out individual transactions to eke out every possible penny.

I caught onto this just before officially listing my house, and insisted we increase the asking price (recommended by him / his team) by 10% – a move he / his team objected to rather frankly. Nonetheless, the sale was completed within 6 weeks or so, at my asking price.

(And seems worth adding he never said thank you for the 10% [relative] extra he earned on the commission)

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

#964

Post by R0b0t1 » Thu, Jun 10, 2021, 5:42 AM UTC

sjg007 wrote: post #889

d110af5ccf wrote: post #886

Earlier quoted context omitted.

I've never been able to wrap my head around why things work like this. If what you build isn't a nuisance to neighbors, houses the same number of people as before, and doesn't pose a safety or environmental hazard, what business is it of anyone else? I've met a significant number of otherwise carefully law abiding people with various non-permitted remodels and even outbuildings. (I guess the latter won't work so well…

Building codes are written in blood.

No, a fair number are written in green ink. Green for someone else.

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

#965

Post by throwaway2037 » Thu, Jun 10, 2021, 5:44 AM UTC

kregasaurusrex wrote: post #854

dvdhnt wrote: post #845

Earlier quoted context omitted.

> Most American households own their home. Do you have a reference for that? I'm interested to see how it breaks down. I have to assume this is true because of America's aging population.

There's data released directly by the US Census Bureau for this: https://fred.stlouisfed.org/series/RHORUSQ156N

Wiki says 64.2% in 2018.

Ref: https://en.wikipedia.org/wiki/Home-ownership_in_the_United_S...

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

#966

Post by throwaway2037 » Thu, Jun 10, 2021, 5:53 AM UTC

delaynomore wrote: post #676

Justsignedup wrote: post #461

Earlier quoted context omitted.

The irony is that density means more people, more homes, more availability. That means more jobs open up and makes the place more lively. More desireable. That means the house property value will go up. They are thinking "will this make the property value go down in the next 5 years"? vs "will this make the property value skyrocket in the next 10 years". We are catering to short-term gains at the expense of long-term…

Look at any typical city in North America, your priciest neighborhood likely has low density. People tend to work away from where they live (at least for high paying jobs) and prefer having ample space at home therefore I don't think higher density would increase property value as you stated.

When I worked in New York City, there was a stark contrast between senior management. Some lived very rich & urban -- West Village single family townhouse or Upper East/West side high rise, and others lived in a huge suburban home in Greenwich, Connecticut or Long Island. It was a weird mix. I could never figure out why they chose one over the other.

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

#967

Post by throwaway2037 » Thu, Jun 10, 2021, 5:53 AM UTC

mywittyname wrote: post #690

delaynomore wrote: post #676

Earlier quoted context omitted.

Look at any typical city in North America, your priciest neighborhood likely has low density. People tend to work away from where they live (at least for high paying jobs) and prefer having ample space at home therefore I don't think higher density would increase property value as you stated.

The priciest neighborhood ($2MM+) in my city is low density and full of mansions for sports stars and execs for of all the local F500 companies. But the next tier in price ($1MM-$2MM) is actually pretty high density housing abutting downtown. Once you get into the $500-$1MM range density falls again, as these are the McMansions in suburbia. Density keeps dropping as price goes down until you get into the slums territ…

Can you share the city name? I'm curious to learn more.

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

#968

Post by josefx » Thu, Jun 10, 2021, 6:15 AM UTC

rwcarlsen wrote: post #914

nibles_and_bits wrote: post #895

Earlier quoted context omitted.

Why did you buy a lot zoned ag when you clearly wanted one zoned residential? A little due diligence before purchasing the lot and you would either know what you in for and still buy or decide it's too much of a hassle and walk.

I didn't buy it until I figured out the (very convoluted and possible) way to build on it while ag. Because rezoning is a long, expensive process that can trivially be blocked by a single neighbor that doesn't want to rezone with me. I wanted the parcel because it was in what I considered a desirable location for a reasonable price. In my region, finding property is getting very difficult - and unless you want to go…

You are lucky that you can even abuse it that much. My home country seems a bit stricter. My grandparents split their farm between my uncle, aunt and mother, with the later two only inheriting a house. When my mother tried to pass it on to my brother someone noted that it handn't been part of a farm or used to house farmworkers for years and should be torn down. The plot it stood on had to be converted to residential to deal with that surprise.

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

#969

Post by basch » Thu, Jun 10, 2021, 6:24 AM UTC

xapata wrote: post #659

basch wrote: post #120

Earlier quoted context omitted.

Presumably, owing money for 60 years instead of 30 years will cost you much more in the long run. And more baked in interest early in the loan means less recovered when you sell.

How the hell do you find a 60-year loan? Sign me up! Remember, leverage is what makes home ownership a good investment.

The premise I replied to was the lump sum doubling and the monthly staying the same. The only way for that to happen is to extend the period.

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

#970

Post by rich_sasha » Thu, Jun 10, 2021, 6:28 AM UTC

crazygringo wrote: post #882

rich_sasha wrote: post #115

Earlier quoted context omitted.

It's still a pain. And once you bought a house, you might like to think of it as an unmovable good (literally, in many languages). Now your cash flow doesn't permit you to live there. Also, with low/zero IR, PV of tax payments is infinite, it's not like increasing house price is offsetting that.

I mean, you're basically arguing against property taxes. Sure, property taxes are a "pain", but so are all taxes. But yes, that's literally how property taxes work -- you don't get to live somewhere infinitely long without paying property taxes. In practical terms though, property taxes aren't infinite -- they're only for as long as you're alive. And you can realize your increasing house price while you're alive too…

> I mean, you're basically arguing against property taxes.

Not really. You’re saying it is no issue that tax goes up proportionally to house value, I’m saying it is much more onerous than, say, your income tax increasing with income.

Also, if the end objective is “pay tax to local government and make it so that wealthier people pay more”, there are tons of ways of doing it without this anti-feature. Slice of income tax, tax depending on property size (not price) etc.