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Zillow seeks to sell 7k homes for $2.8B after flipping halt

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Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#601

Post by rsj_hn »

seanmcdirmid wrote: post #600
dionidium wrote: post #595

Earlier quoted context omitted.

I'm I guess what you would call a supply and demand absolutist. There's no "correct" amount of development or "optimal" level of density (wrt prices, I mean; obviously people have preferences ). If you let demand outpace supply, then you should expect the available market-rate housing to increase in price. (And that's true even if you think your city is building a lot, or if you think it's already really dense, or if…

There are limits to how many people land can carry. Vancouver builds up onto a mountain, which is crazy. Yes, for some price, we could terrace the mountain or even remove it. Vancouver is a boom bust town for real estate, now it is in a boom, it will bust eventually, just like it has many times before. There is just too much speculation going on to represent stable demand.

This is the difference between constrained and unconstrained areas. For example, San Francisco is a constrained area since it's already bounded by other cities and can only increase housing by building higher or getting rid of parks.

But the San Francisco bay is quite unconstrained, with extremely low population density and massive undeveloped tracts all over. Here, only regulation and laws prevent the cities from becoming bigger.

In general, the vast majority of people live in unconstrained areas, not constrained areas. But because constrained areas are where you get the windfall wealth from housing, people in the physically unconstrained areas clamor to make themselves legally a constrained area by making it illegal for the city to grow out.

So yes, there are limits, but these are political limits, not physical or environmental limits, and they are driven by incumbent owners with dollar signs in their eyes, not concern over nature.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#602

Post by 8bitsrule »

pdonis wrote: post #597
zzzzzzzza wrote: post #580

Earlier quoted context omitted.

the money being lent is bank money.. not printed by the fed but by your local bank.

Your local bank can only "print" the money because that amount of money is in its account at the Fed. It's the Fed that's actually creating the money.

More modern theories that strongly dispute that assertion. And certainly the money needed to pay compound interest on the loan has not been created. (Apparently it's expected that borrowers will materialize it.)

"Banks first lend and then cover their reserve ratios: The decision whether or not to lend is generally independent of their reserves with the central bank or their deposits from customers."

[https://en.wikipedia.org/wiki/Money_creation#Credit_theory_o...]

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#603

Post by BuckRogers »

fragmede wrote: post #357
BuckRogers wrote: post #304

Earlier quoted context omitted.

My dilemma is balancing inflation risks through all this increased government spending, with short-term market timing. I think that these risks are more likely than ever, and imminent. On the inflation risks. I really wish the Democrats would cancel all their ideas about child care and what not, and just shift the tax burden from the working class that punch a clock, to the investment class that live off of IRS-defin…

The specifics of your aside aren't especially interesting here, but they are quite important to you before making such a large investment. My time machine's just as good as yours, and anyone that claims their's is any better is trying to sell you something. Risks is inherent in everything. If I were trying to sell anything "rock solid" in Feb 2020; it's possible time would have proven that to be a total lie. If you h…

I definitely have a great mistrust of the near future. It just seems pretty ominous right now. We'd be lucky to have mere stagnation, but I'm afraid these "bad times" are about to be made to look like child's play soon, by at least 2026 and likely sooner.

You raise really good points. Insightful, like many of the responses here. My main thought in reading is this is why I'm buying as cheap as home as I can that is functional. My strategy is just to buy the cheapest home that I'm happy with. If things go to hell, and I really don't have much to lose with the anchor around your neck that home ownership is. If the fridge breaks that's annoying, but I've been renting a long time, few to no landlords want to spend a dollar anyway. They don't lose so owning is the ticket to financial freedom, even if it's not a money maker and merely a way to get expenses down to taxes + utilities. Which is how I see it.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#604

Post by BuckRogers »

mullingitover wrote: post #378
BuckRogers wrote: post #359

Earlier quoted context omitted.

That's what this is about, getting rid of my cash. As I mentioned to someone else, before inflation kicks in bigtime, and timed around these risk factors. I've hoarded cash up until this point almost accidentally, I've just been too busy working to spend. I do like a cushion, but not the cushion I have now. On the mandate job losses, I think a lot remains to be seen. We have the airline issue going on right now, and…

It's really easy to get your cash into a real estate ETF, giving you exposure to that market without any of the fuss or commitment of tying everything up with one property. > Those are the only mandates that make sense to me, and I would hope that by Jove, even our most brainwashed vaccine-loving brethren could get onboard with. I'm afraid that on a planet with 8ish billion meat-based life forms of extremely similar…

I agree but I hate the misuse of the term "vaccine" here. To me that's brainwash. These are closer to the flu shot than a vaccine that conveys sterilizing immunity like the polio vaccine.

I'm uninterested in the flu "vaccine" and the COVID "vaccine". With their narrow band of immunity, that wanes after 6 months requiring yet-more longterm untested vaccine shots. I am interested in the polio vaccine, or any COVID vaccine that's sterilizing.

I don't really want exposure to the real estate market. I put every tax-advantaged dollar that I can into index funds. I hate it, but I don't have a better option as a retirement vehicle. I figure if the stock market is down in 2040 from today's market, we have a lot bigger problems going on in the world than just my retirement. Should have invested in Glocks, Brownings, and ammo. Which I am, but not for that purpose, but rather home defense. When I finally own a home that is.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#605

Post by BuckRogers »

TheMagicHorsey wrote: post #542
BuckRogers wrote: post #529

Earlier quoted context omitted.

You likely have a lot more money than I do, from what you said. I did live in a couple of major cities in Texas over the course of 5 years. I'd recommend the Dallas area. Easily one of my favorite areas in the country, especially for someone starting off. Doing it all over again, knowing what I know now, I might have moved there long ago and stayed. It has also exploded though, but probably nothing near CA proportion…

I agree with most of what you've said, but I think the core issue of affordability is not dependent on private enterprise profits. I think the core issue in California is that its so difficult to build homes in high density, and NIMBYs prevent new development everywhere, creating more and more sprawl as people move ever out of the range of existing NIMBYs to form new towns, where they in turn become NIMBYs. If Califo…

That's interesting. I've never lived anywhere where that's a problem, at least not to that degree. The places I've lived have low costs of living with the wage disparity holding most people down. A truly urban city where half the people are in a high rise, like myself, has its problems too. Which is what the NIMBYs are worried about I would presume. Tough to scale transportation and everything else around it. It really takes one of the older cities that were designed from nearly day-one to be densely populated. Everything is already in place. For example here all the roads are mostly perfectly square making for efficient movement and trains are the heartbeat of the city.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#606

Post by randomopining »

BuckRogers wrote: post #304
randomopining wrote: post #282

Earlier quoted context omitted.

What's your dilemma? If you're gonna live there for 10 years, get a large utility out of the house in general and also owning your own place, then just go for it. If you're buying just to buy, then hold off.

My dilemma is balancing inflation risks through all this increased government spending, with short-term market timing. I think that these risks are more likely than ever, and imminent. On the inflation risks. I really wish the Democrats would cancel all their ideas about child care and what not, and just shift the tax burden from the working class that punch a clock, to the investment class that live off of IRS-defin…

Tbh well put. I’m sure it’s more complicated than that but on the surface it makes sense. And it sells way better.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#607

Post by adam_arthur »

r00fus wrote: post #551
adam_arthur wrote: post #445

Earlier quoted context omitted.

The solution is simple. Raise rates and let asset prices normalize, regardless of the consequences. There will be pain in the short term, but you're creating opportunity for future generations. Policy right now is all about pulling prosperity from the future into the present. IE higher valuation multiples today enrich current asset holders, but leave little growth for future asset holders It used to be that the Fed w…

> It used to be that the Fed was not too focused on asset valuations, and actually drove policy on the basis of their mandates. Unfortunately they're too cowardly to do that anymore. Could it be that they're essentially captured by the likes of Blackrock, etc. I mean, it's been this way for a while, but it's getting to where government is openly a tool for the corporations without voter involvement.

Well, BlackRock actually manages their bond buying program, believe it or not. So BlackRock is the one executing the Feds QE purchases.

But I think it has more to do with the Fed trying to appease both the political party in power (as they control their renomination) and just people generally.

With all the social media etc nowadays, they have more scrutiny over their actions, and are afraid of making tough decisions. E.g. optimizing for the short run to the expense of the longer run.

But to your point, Powell in particular is much more focused on the stock market and how wealthier Americans (stockholders, homeowners etc) are doing. Past fed chairmen, like Yellen and Bernanke didn't seem to care nearly as much about market movements, and focused more on the economy itself, and their mandate.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#608

Post by adam_arthur »

xenadu02 wrote: post #596
adam_arthur wrote: post #445

Earlier quoted context omitted.

The solution is simple. Raise rates and let asset prices normalize, regardless of the consequences. There will be pain in the short term, but you're creating opportunity for future generations. Policy right now is all about pulling prosperity from the future into the present. IE higher valuation multiples today enrich current asset holders, but leave little growth for future asset holders It used to be that the Fed w…

> The solution is simple. Raise rates and let asset prices normalize, regardless of the consequences. This is the exact policy adopted by the Fed in 1929: purge the bad out of the system. Let the failing banks go bankrupt. That turned what was a recession into a full-blown deflationary credit crunch. All the high-and-mighty theory and bloviating may not mean much in the face of 25% unemployment, wages falling 50%, an…

Yeah, but the point of the fed is to smooth the peaks and troughs.

Stimulus in recessionary periods is smart, and prevents prolonged recessions like was seen in the great depression, and somewhat during the GFC.

But the stimulus has already been done at this point. The crisis is over.

The situation we're in now is corporate earnings at all time highs, the gap between open jobs and job seekers at all time high, consumers with spending power at all time high, home prices accelerating at all time highs, inflation running very hot.

So this is the exact time that the Fed should be smoothing the peak, to avoid a full on bubble type of scenario. By not acting, they setup the risk factors for another 1929 or 2008. E.g. encouraging mass speculation, high levels of debt and so on.

So I agree with you. But the goal should be to avoid creating the conditions for systemic failures by letting bubbles get out of hand. China in particular let their real estate bubble get far out of hand, to the point that it's not really possible to resolve without creating a systemic issue.

You fundamentally just have to accept some down periods and small hits to avoid the massive failures that come along with facilitating much larger bubbles/structural risks.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#609

Post by iudqnolq »

outericky wrote: post #443
ep103 wrote: post #321

Earlier quoted context omitted.

They are generally called non-primary residency taxes, and they're definitely a thing, and definitely getting more publicity, and most definitely need to become much stronger and more widespread.

Non primary is one thing - but perhaps the thing that needs to be gone after is commercial residential (as in, if you have more than x properties). Or commercial ownership of single family homes. There is a difference between owning a 10 unit apartment and owning 10 single family homes.

> There is a difference between owning a 10 unit apartment and owning 10 single family homes.

Yes, one effects people like you and the other effects people like me.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#610

Post by grey-area »

VBprogrammer wrote: post #517
bdxn wrote: post #470

Earlier quoted context omitted.

It's not an accounting trick; it's historically low rates. At the beginning of 2021 would you rather have paid 350k cash for a house or taken a 30 year mortgage and invested the remaining 80% (after a 20% down payment) into the sp500? Your house might be up around 10-25% depending on the market making your 20% stake worth more. and your 280k cost-basis that you invested would be worth 350k. You'd have already earned…

If instead of buying the house cash I put it all into bitcoin at the begining of the year I'd now have enough to pay off the mortgage, the early repayment fee and have change to spare. This being the utter fucking fallacy of hypothesising with the benefit of perfect information.

Personally I wouldn't touch bitcoin, nor do I consider it an asset. Returns on stock investments are historically high for the last couple of decades it's true, but if you take the average of say 5% a year, it's still much better than putting that money into a mortgage, when you can borrow the money over a long time period at It's not a trick, it's simple maths. It certainly doesn't always work, and there are risks involved, so not everyone will agree on the right decision, but there is clearly a path where borrowing money to pay for a large asset makes sense.
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