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How Zillow's homebuying scheme lost $881M

fullstackeconomics.com

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

#481

Post by refurb »

Teknoman117 wrote: post #460
closeparen wrote: post #241

Earlier quoted context omitted.

For example, the entire state of California, including municipalities that don't have rent control and properties that aren't covered by existing rent controls. https://sfrb.org/article/summary-ab-1482-california-tenant-p...

What are the bounds of that though? No place that I have lived in California gives me the option of continuing my lease under the current terms (never once did they not increase my rent)

AB1482 is statewide and covers most rental stock. Units built in the last 15 years are exempt. Single family homes are exempt, but only if explicitly included in the lease (plenty of landlords got bit by this in 2020 - no notice to tenant, automatically covered by rent control/eviction control).

This is both rent control and eviction protection. You cant be evicted without “just cause” - all leases automatically roll over to "month to month".

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

#482

Post by refurb »

1024core wrote: post #215
Teknoman117 wrote: post #71

Earlier quoted context omitted.

> 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. This is one of those things that really just confuses me. It's like no one could agree on happy medium between "landlord can eject you whenever they want for whatever reason" and "no one can make you leave, ever, for any reason". And to whoever downvoted yo…

Could you not put ejection conditions in the lease itself? (SF resident here, but with no experience in landlording). I'm wondering why can't a landlord put in the lease a term like "if tenant does not pay rent for 30 days, tenant gives up all of his rights and landlord has the right to eject tenant within 15 days".

No. It’s pretty common for tenancy laws to make all other condition “void and unenforceable”.

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

#483

Post by refurb »

gnicholas wrote: post #117
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…

A friend bought a duplex in Berkeley. Due to the tenant-friendly laws there, she will only rent to international university affiliates whose roles/visas will require them to leave after a year or two. Interestingly, she is very YIMBY and liberal, and even has a PhD in urban planning. But no one wants a forever tenant!

I know a landlord with a 4 unit rent controlled building in SF. As tenants leave, the units are left empty. Some units have been empty for 3+ years now.

Why? Because she is retiring and an empty building will sell for several hundred thousand more than one with tenants - giving up $300k in rent over a few years is an easy trade off when she can sell the whole building for $600k more.

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

#484

Post by refurb »

dragonwriter wrote: post #394
nebula8804 wrote: post #389

Earlier quoted context omitted.

>Everyone wants to call themselves a liberal or progressive nowadays, it's bizarre. Thats just the scam the corporate left likes to play. They love to be super "progressive" while actually performing nothing progressive other than performance art. It costs nothing to call yourself "progressive". Hell I bet Trump has probably called himself "progressive" ha ha. Like you said, its actions that matter. If you look at th…

> the corporate left This thing does not exist.

Haha… all those woke Silicon Valley CEOs would prove you wrong.

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

#485

Post by tristor »

schrijver wrote: post #250
tristor wrote: post #129

Earlier quoted context omitted.

> 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. I'm in this situation right now. The only way I'll rent it out is if I personally know the tenant and their personal chara…

This is so alien to me. Why don’t you sell the place? Staying the owner of this place makes it so that you can’t spend your money tied up in this house, and this house can’t provide its roof to someone. Seems like both of you loose.

I had to move, but I want to come back. I already have a paid off house in this city after living here for 14 years. Selling it doesn't net me enough profit to meaningfully change things for myself in the new city after taxes, so it's better to hold onto it for when I eventually return.

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

#486

Post by MiroF »

refurb wrote: post #481
Teknoman117 wrote: post #460

Earlier quoted context omitted.

What are the bounds of that though? No place that I have lived in California gives me the option of continuing my lease under the current terms (never once did they not increase my rent)

AB1482 is statewide and covers most rental stock. Units built in the last 15 years are exempt. Single family homes are exempt, but only if explicitly included in the lease (plenty of landlords got bit by this in 2020 - no notice to tenant, automatically covered by rent control/eviction control). This is both rent control and eviction protection. You cant be evicted without “just cause” - all leases automatically roll…

It only applies to homes owned by a corporation, you are incorrect that most properties are not exempt.

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

#487

Post by epistasis »

tshaddox wrote: post #188
paxys wrote: post #40

Earlier quoted context omitted.

One can blame Airbnb, Zillow or whoever else, but the truth is that speculation in real estate and vacation towns have both been a thing for a very long time. If the population rises and we refuse to build more houses, the existing ones will get more expensive no matter what. The solution is out there in front of us but everyone prefers to dance around it.

> If the population rises and we refuse to build more houses Building more houses is generally good too, but it's a bit of a cop-out to blame the whole situation on that. Totally independent of supply concerns, I would argue that it's not great that in so many areas the value of homes seems to be almost entirely divorced from the fact that people need homes to live in . Imagine if a bunch of very wealthy people just…

This comment and analogy fundamentally misunderstands the problem here, though:

> the value of homes seems to be almost entirely divorced from the fact that people need homes to live in.

The value of homes is so high precisely because people need somewhere to live, desperately. The price is not disconnected from need, it's entirely because of need.

And it's not that wealthy people are buying and hoarding homes. There's not some magic supply of 20-30% vacant unoccupied housing, there's desperately low vacancies, absolutely criminally low amounts of vacancies.

But refusing to acknowledge the panacea of building new homes does serve the purpose of wealthy people who currently own home. Because they are not hoarding homes, they are hoarding land. They are hoarding access to the ability to build more homes, the homes that are desperately needed. And in high demand areas, every person that goes and opposes new homes, that opposes upzoning, is directly responsible for displacing however many people those new homes would have built.

There is only one solution to high home prices, and that's building more. (Well, we could also institute strict border controls and price controls and completely destroy freedom of movement and access to jobs.)

Downplaying the primacy and necessity of building enough homes for people that want to live in an area only fuels higher prices, more hoarding of land, and more exclusion. There's zero upside to saying "we don't need to build" except to enable further financialization of housing and concentration of wealth in homeowners.

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

#488

Post by jen20 »

epistasis wrote: post #487
tshaddox wrote: post #188

Earlier quoted context omitted.

> If the population rises and we refuse to build more houses Building more houses is generally good too, but it's a bit of a cop-out to blame the whole situation on that. Totally independent of supply concerns, I would argue that it's not great that in so many areas the value of homes seems to be almost entirely divorced from the fact that people need homes to live in . Imagine if a bunch of very wealthy people just…

This comment and analogy fundamentally misunderstands the problem here, though: > the value of homes seems to be almost entirely divorced from the fact that people need homes to live in. The value of homes is so high precisely because people need somewhere to live, desperately. The price is not disconnected from need, it's entirely because of need. And it's not that wealthy people are buying and hoarding homes. There…

> And it's not that wealthy people are buying and hoarding homes.

This is exactly what buy to let landlords are doing.

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

#489

Post by voidfunc »

paxys wrote: post #40
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,…

One can blame Airbnb, Zillow or whoever else, but the truth is that speculation in real estate and vacation towns have both been a thing for a very long time. If the population rises and we refuse to build more houses, the existing ones will get more expensive no matter what. The solution is out there in front of us but everyone prefers to dance around it.

Nobody is dancing around anything. We need to stop pretending its ignorance driving the housing bubble. The problem is real estate is treated as an investment and in many cases the most important investment for ordinary people. More housing works against their interests.

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

#490

Post by soggybutter »

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,…

Top 2% puts you fairly deep into the six figures, no? I've not even surpassed top 10% and haven't had too much issue getting into 2 homes in the last 3 years. Both in areas I would consider "semi-desirable", which leaves me wondering what exactly do other folks consider "semi-desirable"? Unless of course you mean buying a home outright, in which case this makes total sense
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