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How Zillow's homebuying scheme lost $881M

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Re: How Zillow's homebuying scheme lost $881M

#81

Post by londons_explore »

KptMarchewa wrote: post #70
jliptzin wrote: post #51

Earlier quoted context omitted.

There's even lower hanging fruit than that. I have a 6 bedroom house, but local regulations state that I am not allowed to live with more than 2 people unrelated to me. Plenty of parking, tons of people looking for housing, but legally I am forced to keep 3 bedrooms empty.

>local regulations state that I am not allowed to live with more than 2 people unrelated to me What? Where is that? It sounds insane and extreme overreach. How can somebody regulate with whom consenting adults choose to live?

Regulations like this are common.

Usually you need to get a special license, have home inspections annually, pay various fees, etc. if you want to do so.

Re: How Zillow's homebuying scheme lost $881M

#83

Post by rank0 »

InitialLastName wrote: post #63
rank0 wrote: post #50

Earlier quoted context omitted.

Sorry man that sucks. I own a property that's effectively a duplex in Atlanta. My buddy owns a duplex in Denver. It's not everywhere that mixed residential homes are banned! Are you in CA?

Normally when people talk about mixed-use development, they are talking about zoning rules that allow residential and commercial use in close proximity, not necessarily about forced single-family use (although that is also an issue in many places).

Ah I see I misunderstood. FWIW though there's businesses scattered all over my neighborhood and seemingly no zoning rules. Lots of folks, especially the ones on this forum, would probably not live in Atlanta simply because of their perception of the city.

Re: How Zillow's homebuying scheme lost $881M

#84

Post by not2b »

rank0 wrote: post #50
t-writescode wrote: post #30

Earlier quoted context omitted.

Not me. I just want mixed residential housing. Yeah, it’s not happening because America made that effectively illegal. We’re finally rolling some of that back, but it’s going to take decades to undo and by that time the shortage will continue.

Sorry man that sucks. I own a property that's effectively a duplex in Atlanta. My buddy owns a duplex in Denver. It's not everywhere that mixed residential homes are banned! Are you in CA?

In California, there's currently a fight between the state government, which wants cities to allow more housing, and local governments, which are opposed to higher density housing because the NIMBYs ("not in my back yard") fight it. The restrictive zoning laws are at the local level, not the state level.

Re: How Zillow's homebuying scheme lost $881M

#85

Post by javert »

thr0wawayf00 wrote: post #9

The scary thing is that it's easy to see how something how like this could drive a market boom and bust cycle. I'm imagining a scenario where two iBuyer companies try to outbid each other algorithmically, driving the prices further and further out of reach of people who are looking for a primary home. Tangentially related, I talked to a friend who works on geospatial data for one of the big vacation rental companies,…

It's because US monetary policy has created an enormous transfer of wealth to the wealthy and out of the general economy. They do this by extending credit at low interest rates with the collective understanding that the value of the dollar will continue to be printed away. The wealthy (like me...) buy stuff on credit now and pay it back later with much cheaper future dollars.

COVID threw a wrench in the scheme temporarily and caused a lot of that money to start trickling down, which is why we're seeing wages rise rapidly and high consumer-level inflation.

By the way, bitcoin fixes this.

Re: How Zillow's homebuying scheme lost $881M

#86

Post by dave5104 »

KptMarchewa wrote: post #70
jliptzin wrote: post #51

Earlier quoted context omitted.

There's even lower hanging fruit than that. I have a 6 bedroom house, but local regulations state that I am not allowed to live with more than 2 people unrelated to me. Plenty of parking, tons of people looking for housing, but legally I am forced to keep 3 bedrooms empty.

>local regulations state that I am not allowed to live with more than 2 people unrelated to me What? Where is that? It sounds insane and extreme overreach. How can somebody regulate with whom consenting adults choose to live?

Occupancy limits are somewhat common in many cities/towns. But probably only enforced via neighborly complaint, so you don't really hear about them.

Just searching "occupancy limits city" popped up the limits for Boulder, CO: https://bouldercolorado.gov/occupancy-limits

Re: How Zillow's homebuying scheme lost $881M

#87

Post by kevin_thibedeau »

thebean11 wrote: post #66
a1pulley wrote: post #62

Earlier quoted context omitted.

> It's honestly quite scary how I'm in the top 2% of income earners in my generation and yet I could barely afford to buy a small place in a semi-desirable area. I can easily see myself not being able to compete in algorithmically dominated markets flush with venture cash in the future and I earn more than just about everybody I know today. A thought exercise: suppose that no new houses are ever built and that housin…

> suppose that no new houses are ever built Why would you suppose that? I don't really see what you're getting at, that's a very unintuitive assumption; it shouldn't happen if market forces are allowed to run their course.

New afordable housing isn't built. Everything is "luxury" so that developers can maximize profit. When someone tries to build affordable duplexes the NIMBYs say not in my town.

Re: How Zillow's homebuying scheme lost $881M

#88

Post by a1pulley »

thebean11 wrote: post #66
a1pulley wrote: post #62

Earlier quoted context omitted.

> It's honestly quite scary how I'm in the top 2% of income earners in my generation and yet I could barely afford to buy a small place in a semi-desirable area. I can easily see myself not being able to compete in algorithmically dominated markets flush with venture cash in the future and I earn more than just about everybody I know today. A thought exercise: suppose that no new houses are ever built and that housin…

> suppose that no new houses are ever built Why would you suppose that? I don't really see what you're getting at, that's a very unintuitive assumption; it shouldn't happen if market forces are allowed to run their course.

I was trying to draw attention to the fact that "I'm in the top 2% of earners but I can't afford a house" isn't surprising when legislative factors make it hard to add housing stock, when turnover is low, and when there's net population inflow.

My supposition was intentionally exaggerated to clarify what happens when you don't build enough housing: not to be pedantic, but understanding what happens in "extreme cases" is a common technique in math and physics to understand what happens in more common ones.

Re: How Zillow's homebuying scheme lost $881M

#89

Post by dopamean »

Finnucane wrote: post #75

"In the real estate industry, this service is called iBuying, " Also, 'flipping.'

I dont really think anyone would call the business models of Opendoor, Offerpad, and formerly Zillow "flipping." Yes, they did buy a house with the intent to sell it but imo the term flipping refers to a much, much smaller scale business that also includes fixing up the property in some way. That is not what iBuyers do.

Re: How Zillow's homebuying scheme lost $881M

#90

Post by paxys »

mentalpiracy wrote: post #79
paxys wrote: post #57

Earlier quoted context omitted.

Agreed. Heck I know several people who prefer to keep their condos/houses empty rather than rent them out at market rate because of 100% tenant friendly city and state laws. Someone can move in and refuse to pay rent, refuse to leave, use your house as a drug den, destroy your property and lots more, and you can do nothing about it. At that point the city is just incentivizing homeowners to contribute to the housing…

Why should we use this as an example? You’re talking about people who are throwing away money by leaving assets idle - and implying that they obviously don’t know how to operate in this market.

> You’re talking about people who are throwing away money by leaving assets idle

No, they are watching their assets shoot up in value every day without any operational burden.

> and implying that they obviously don’t know how to operate in this market

When did I say that? In fact what they are doing the most logical thing.

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