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Investors bought a quarter of US homes sold last year

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Re: Investors bought a quarter of US homes sold last year

#441

Post by cycomanic »

giantg2 wrote: post #252
ethanbond wrote: post #126

Earlier quoted context omitted.

High LVT means you pay a high tax on the land itself and little or no tax on what you do on top of that land. It encourages highly efficient land development which means increased supply of commercial and residential units (thus reducing rents), and it makes lots of speculation prohibitively expensive. Since holding undeveloped land is just as expensive as holding developed land, you’re going to want to put it to pro…

... and pricing out existing residents in low density housing by taxing them to oblivion.

I never understood this argument. People are not priced out of their homes. Their homes are rising in prices so they actually have assets to match the price increase. Yes they might not be able to afford the tax, but they have a million dollar asset that they could use. The whole point of the tax is to disencent a single person living in a huge house all by themselves.

Re: Investors bought a quarter of US homes sold last year

#442

Post by com2kid »

JamesBarney wrote: post #406
com2kid wrote: post #356

Earlier quoted context omitted.

IMHO cities need to limit how many large multi-national conglomerates are allowed to build huge rental complexes. A large % of the high density housing being built around Seattle is rental only, all that does is funnel money out of the city. Residents don't get to build equity, and rental prices keep going up year over year, vs mortgage payments that, except for the property tax portion, stay the same over 30 years.…

When they don't come in and build out those large rental complexes those very well paid engineers rent/buy every SFH for miles causing the absolutely insane gentrification we've seen in San Francisco that pushes everyone out.

> those very well paid engineers rent/buy every SFH for miles causing the absolutely insane gentrification we've seen in San Francisco that pushes everyone out.

I used to live in a large, over 100 unit, town home complex.

Central to the complex was a very large open green space, larger than most suburban yards.

Over the years, about 50% of the units are now rented out, typically at a price lower than in the nearby built for rental apartment complexes. Individual landlords prize stability in tenants more than maximizing short term value, also if a person is only renting out 1 unit, that unit being vacant for a month or two is a lot of lost income, raising rent by $200 and then losing out on 4k of rental income due to having to lose then find a new tenant is not something a smart landlord does on a yearly basis.

Prior to that I lived in a luxury condo complex in a very nice area that was again, lots of rental units. From what I gather, soon to be retirees had bought in and were renting the units out until they they needed to move into them. They also prized stability and boring tenants over maximizing monthly income.

The point here is, within reason, today's fancy high end condos are tomorrows reasonably prized housing.

Will the 50 story skyscraper condos ever be reasonably prized? No, of course not, but if someone dropped 150,000 units of medium density housing into Seattle, I bet that in about 5-10 years housing prices would start to come down.

The other issue I have is the absurd number of 4 story town homes being built, which should instead be 4 story condo complexes. Insane square footage is wasted on stairs, and no one over 35 can live in those places, and raising a family in them is either impractical or horribly annoying. (Good for baby gate sales though...)

If it were up to me I'd remove elevator requirements for 4 and 5 story condo complexes in return for having the bottom floors requiring ADA units.

Re: Investors bought a quarter of US homes sold last year

#443

Post by bombcar »

ghaff wrote: post #417
ryukafalz wrote: post #287

Earlier quoted context omitted.

Which doesn’t mean much as a comparison point in the US because much of that land has zero or approximately zero residents, and nobody’s talking about building high-density housing in the middle of nowhere anyway. Upwards of 80% of the US population lives in urban areas and those places certainly are comparable to much of Europe.

>Upwards of 80% of the US population lives in urban areas Look up the US Census definition of "urban." In the town where I live, three houses around me are on 100 acres collectively--not to mention even more adjacent conservation land and that's classified as urban because it's near a smaller old mill town and only about 50 miles from a major city.

Apparently the new "urban" definition is something like:

>Adopting 500 persons per square mile (PPSM) as the minimum density criterion for recognizing some types of urban territory.

https://www.federalregister.gov/documents/2022/03/24/2022-06...

Which basically means anything "town-like" or higher is "urban".

So most Americans live in urban areas even if they are in a tiny town in the middle of nowhere.

Re: Investors bought a quarter of US homes sold last year

#444

Post by BeetleB »

survirtual wrote: post #304
slg wrote: post #40

Earlier quoted context omitted.

We have spent decades telling American families that homeownership is the safest investment. We then spent decades enacting policies to ensure this is true. Do we think investors were going to just sit that out and ignore a safe and government protected investment? Of course the more attractive we make home ownership as an investment, the more investors will flock to the market. We need policies specifically benefiti…

I sold my houses in a booming market for a $70,000 loss intentionally. It has a nice effect of lowering the value of all my neighbors homes and housed a deserving family. Little did I know when I went to claim the loss on my taxes: I could not claim the loss at all. Since it was an owner occupied house and not a house owned by a corporation, it did not count as a loss I could deduct from my income nor from my capital…

> Little did I know when I went to claim the loss on my taxes: I could not claim the loss at all. Since it was an owner occupied house and not a house owned by a corporation, it did not count as a loss I could deduct from my income nor from my capital gains.

It cuts both ways. Had you had a gain, you would not have had to pay taxes on the gains. If you had it as an investment, you would.

> Houses are meant to trap and enslave common people. It decreases their mobility and roots them in areas they otherwise would want to leave. When you gain money from a house, there are all kinds of benefits. When you lose money as an owner, there are no protections for you.

Hyperbole. For the majority of folks, home ownership outweighs the costs. Often significantly.

Re: Investors bought a quarter of US homes sold last year

#445

Post by slg »

missedthecue wrote: post #429
slg wrote: post #377

Earlier quoted context omitted.

> it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater. What is those people's second biggest purchase which is also usually done with debt? Does anyone believe that the government should enact policies to ensure that car prices always increase so they would be a better investment?…

Resale value is probably one of the number one things car buyers look at when shopping.

No one expects that resale value to go up. No one suggests that the government creates programs to prop up that resale value. People understand that owning a car gives them value and they are fine paying the difference between the purchase price and the resale price for that value. Why should homeownership be different? Why should homeownership not just be free but profitable? It makes no sense other than homeowners were told it was true, demand it be true into the future, and they (now joined by institutional investors) are a powerful voting block.

Re: Investors bought a quarter of US homes sold last year

#446

Post by cycomanic »

icelancer wrote: post #229
aprdm wrote: post #69

Earlier quoted context omitted.

The concept of credit score isn't something that has always existed in humanity. It's something that we can go on without, even more so given the ridiculous profitability of banks

Like IQ tests, the credit score has egalitarian roots, but modern day activists think they're discriminatory and should be abolished.

The IQ test does not have egalitarian roots, it was simply a tool designed to diagnose people with severe learning disabilities and was later abused to give a metric to people to feel smug about themselves. It doesn't have significant correlation with any meaningful success metric as soon as we disregard the people with learning disabilities.

Re: Investors bought a quarter of US homes sold last year

#447

Post by onlyrealcuzzo »

cammikebrown wrote: post #313
onlyrealcuzzo wrote: post #17

Earlier quoted context omitted.

> I am not alright with paying absurd rent. Then you should either: 1) Buy a house to live in 2) Buy a house to hedge against rents going bananas The 30-year fixed rate mortgage at negative real rates is the biggest handout the world has ever seen.

Being able to afford 20% down on a mortgage is something affordable to less people every year. With rates increasingly quickly, it's not going to be much cheaper if prices fall too.

So buy at 3.5% down.

The more leverage you have - the more you're taking advantage of The Federal Reserve mandate that prices go up at least 2% per year.

2%x33 = 66% return GUARANTEED by yours truly, the Federal Reserve.

Re: Investors bought a quarter of US homes sold last year

#448

Post by kzrdude »

wiradikusuma wrote: post #154

"but many Republican lawmakers oppose such controls." — I'm not American and not in in the US, so I'm wondering, why in many articles I read, "Doing Good Things For People™" tend to be opposed by Republicans? 1. Are there a scheme to vilify them? Bcoz it's not even mentioned why they oppose (maybe they see Bad Things™ far ahead). 2. Are they not elected by the people?

Paraphrasing Lawrence Lessig: “To even stand in the general election, you first have to win the ‘money election’.”

That's his take on how campaign finance influences which candidates run or are “taken seriously” by the media - presidential primaries or congressional candidates alike.

The republic is unfortunately not “dependent on the people alone” if money has a too tight grip on who gets to run for election.

Re: Investors bought a quarter of US homes sold last year

#449

Post by BeetleB »

aeternum wrote: post #36
sillystuff wrote: post #12

In 2012 I was looking at investing in REITs. One REIT's pitch was that they owned such a large percentage of the rental housing in Tampa Florida, that even though vacancy rates were high, and rents were going down throughout the nation and other areas in the state of Florida, they were able to keep rents high in Tampa. Disgusted, I realized the harm that REITs and private equity are doing to housing markets, and want…

There are so many housing incentives (tax-breaks, etc.) designed to encourage home ownership a very simple solve would be to ensure those only apply to owner-occupied housing and limited to a single home per household.

As another commenter pointed out - most tax incentives for living in a home you own do not apply to investors. Investors get those benefits "for free" because they are a business and all the costs of running a business are deductible. The incentives you speak of actually puts regular folks on a more even footing as corporate folks.

Stuff like bonus depreciation - yeah, let's get rid of that. Or 1031 exchanges. Regular folks cannot benefit from it.

Re: Investors bought a quarter of US homes sold last year

#450

Post by onlyrealcuzzo »

sleepdreamy wrote: post #277
onlyrealcuzzo wrote: post #17

Earlier quoted context omitted.

> I am not alright with paying absurd rent. Then you should either: 1) Buy a house to live in 2) Buy a house to hedge against rents going bananas The 30-year fixed rate mortgage at negative real rates is the biggest handout the world has ever seen.

Can you elaborate on your last sentence a bit more? Just trying to get a more thorough explanation. I just got my first 30 year mortgage so, trying to make myself feel better I guess.

If you just bought, you don't have a negative real interest rate.

Your interest rate is probably 5% or so?

The real interest rate is probably 3% or so. That means your REAL interest rate is 2%.

When you inevitably get the chance to refinance at below 3% - your REAL interest rate will be negative.

The 30-year fixed mortgage is a product that would not exist without a government guarantee on Fannie & Freddie's debt. Even if you have a jumbo loan - it's only because of the MBS market created by Fannie & Freddie.

In essence, the tax payer is paying you for you to have a mortgage on your house - regardless of whether Fannie securitized your mortgage.

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