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US will ban Wall Street investors from buying single-family homes

reuters.com

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Re: US will ban Wall Street investors from buying single-family homes

#631

Post by andrekandre »

notepad0x90 wrote: post #574
jazzyjackson wrote: post #324

Earlier quoted context omitted.

This is basically a maximum wage for landlords, bound to start a secret society. IMO it's a crooked notion that landlords are rent seeking and nothing else - they do create supply and maintain housing. Issue is when they want to politically and artificially raise the value of their property by preventing more housing from being built, so, if you're going to ban something, ban artificial regulations on construction! N…

Renting should be viewed is a negative in society. Imagine if car dealerships moved to a rental model instead of ownership..oh wait, they sort of already are, they just call it "financing", they make no money from cash buys because of that economic perversion. Rent income is not wages, that's the critical part you're mistaken. Income and wages are not the same thing. Rent income is as much wages as Elon Musk selling…

  > The kind of capitalism we have now is a short-sighted parasitical money-grab.
it would seem so, at least in the west perhaps... but i wonder what the cause is; is it culture? or just organic growth is becoming harder and harder?

Re: US will ban Wall Street investors from buying single-family homes

#632

Post by JumpCrisscross »

danny_codes wrote: post #618
Someone1234 wrote: post #421

Earlier quoted context omitted.

The problem with "increase supply" is that existing property owners rarely want that. In almost all cities land has run out, so the only way to actually increase supply is to increase density. That means fewer single-family-homes, and more townhomes, multi-family, condos, and apartments. The "American Dream" is a single-family-home, surrounded by other single-family homes, but even with urban sprawl we simply run int…

> In almost all cities land has run out, so the only way to actually increase supply is to increase density. That means fewer single-family-homes, and more townhomes, multi-family, condos, and apartments. Existing property owners can only afford to hold this opinion because land rents are insufficiently taxed. Through some sort of monumental stupidity we decided to tax labor instead of land. In this sense the SFH, “A…

> we decided to tax labor instead of land

I live in Wyoming. We don't tax labor. Just extraction, consumption (sales), some investments and property. Our property is still expensive.

> If homeowners were faced with the economic reality of their choices then markets would fix land use by themselves

The problem begins and ends with supply restrictions.

Re: US will ban Wall Street investors from buying single-family homes

#633

Post by potato3732842 »

jazzyjackson wrote: post #324
mycodebreaks wrote: post #261

Earlier quoted context omitted.

Controversial, but for affordability reasons, there even should be a cap on how many homes an individual can own for rentals. For the sanity in the housing market, members of society need to be driven to participate in other business activities for income/revenue, not rentals.

This is basically a maximum wage for landlords, bound to start a secret society. IMO it's a crooked notion that landlords are rent seeking and nothing else - they do create supply and maintain housing. Issue is when they want to politically and artificially raise the value of their property by preventing more housing from being built, so, if you're going to ban something, ban artificial regulations on construction! N…

The municipality cares about the taxes, sure but it goes far beyond that. Literally everyone in every department is more convenienced by attracting the well off and being hostile to those who aren't. Those rich people in those big houses with their big assets are much "easier to own" for the town than a bunch of rowdy generally noncompliant trailer trash who crank out a bunch of kids who need services, have poor elderly who need services, don't goose step in line without a bunch of enforcement, can't pay the taxes to pay for the "do we really need this" equipment and facilities government always wants, the working parents can't pick up the slack if the schools slip and scores will show it, etc, etc, etc.

Growing municipalities kind of have to choose if they want to become bedroom communities or industrial/business communities and if they choose the former optimizing for rich people is the easy lazy not sticking their neck out choice and what does government employment optimize for if not retaining people disposed toward that sort of decision making.

Re: US will ban Wall Street investors from buying single-family homes

#634

Post by JumpCrisscross »

pianopatrick wrote: post #601

I'd be fine with a policy of "you can rent housing you build" for American corporations. If a corporation thinks there is demand in some city, goes and build housing for that demand and then rents that housing, that is good for the world. Would be a better policy than letting corporations use their access to capital markets to outcompete individuals trying to buy a house.

> I'd be fine with a policy of "you can rent housing you build" for American corporations

Builders are more concentrated than landlords in pretty much any geography. A concentration that scales with the amount of bureaucracy and bullshit required to get permits.

Re: US will ban Wall Street investors from buying single-family homes

#635

Post by JoshTriplett »

klipklop wrote: post #581
gbear605 wrote: post #545

Earlier quoted context omitted.

I have a friend who has someone who has repeatedly threatened to assault her, and her primary protection is keeping her address hidden from him. Should she never be allowed to own a house at risk of being assaulted?

This is pure whataboutism and made in bad faith. I feel for your friend (if they exist beyond you trying to make an argument), but there are various physical and legal ways to protect yourself from this situation in the US. This edge case is not a good enough reason help shield foreign oligarchs and large corps holding real estate in secret. There is probably a compromise somewhere between both extremes.

> This is pure whataboutism

This is by definition not whataboutism. Whataboutism is when you distract from a thing with unrelated things (e.g. "but there are more important bad things going on in the world than this!"). It is not whataboutism to bring up legitimate related counterarguments for a policy.

Re: US will ban Wall Street investors from buying single-family homes

#636

Post by JumpCrisscross »

JoshTriplett wrote: post #23

One additional important detail: if this gets implemented at all, hopefully it does not affect the common practice of having a self-owned LLC owning your home. This is common for the purposes of keeping your personal name out of public records; it is far too easy to link someone's name and address, and people at risk of doxing can do this to protect themselves.

> a self-owned LLC owning your home

Trusts are in the same boat. If you're using the LLC as a pass-through, these restrictions won't apply to you unless an orange cat is charged with drafting.

Re: US will ban Wall Street investors from buying single-family homes

#637

Post by throwaway2037 »

kortex wrote: post #411
WalterBright wrote: post #325

Earlier quoted context omitted.

> They are a tiny portion of the market, but a huge driving force in setting and manipulating prices, because their properties get leveraged, instrumentalized, and securitized, with derivative products, speculation, and all sorts of incentives that you don't normally want operating in the arena of housing. Raising prices when you only have a tiny portion of the market does not work. People won't buy them when there's…

Going by the graph in the article, that's still ~13% of homes owned by investors with >5 properties. And that's total of what is currently held, it speaks nothing of liquidity. That number likely includes investors who have had that property for a long time, the current property buy-up likely means far greater than 13% of the market right now is going to those sorts of aggregators. Dropping the price of a house by a…

I think Vancouver has a vacancy tax. Does it work?

Re: US will ban Wall Street investors from buying single-family homes

#638

Post by throwaway2037 »

no_wizard wrote: post #455
kortex wrote: post #411

Earlier quoted context omitted.

Going by the graph in the article, that's still ~13% of homes owned by investors with >5 properties. And that's total of what is currently held, it speaks nothing of liquidity. That number likely includes investors who have had that property for a long time, the current property buy-up likely means far greater than 13% of the market right now is going to those sorts of aggregators. Dropping the price of a house by a…

You may be interested in learning about the Land Value Tax[0] which will in effect, taxes become more burdensome for leaving land unproductive (e.g., empty housing or land). It also shifts the calculus on home improvements, which means remodeling your home or doing other perhaps large pieces of upkeep will not trigger a property tax increase as it does today, which is better for median home owners as well. [0]: https…

    > home improvements, which means remodeling your home or doing other perhaps large pieces of upkeep will not trigger a property tax increase as it does today
I have heard this complaint here a few times, but very few specifics. I would call getting your roof replaced or your kitchen/bathroom remodelled as major home improvements. Do these actually property tax increases?

Re: US will ban Wall Street investors from buying single-family homes

#639

Post by _silicon »

mpyne wrote: post #606
ZeWaka wrote: post #500

Earlier quoted context omitted.

> 100,000 individuals who own 100,000 properties have far more political power than 10 companies who own 100,000 properties. Is that really true in the US?

100,000 votes (and really probably closer to 150,000 influenceable votes across those households) is a significant number compared to 10 companies who own an average of 10,000 properties each, yes.

Companies with tremendous wealth manipulate voters and lobby their representatives. Don’t presume that voters are remotely well-informed of who backs their interests.

Re: US will ban Wall Street investors from buying single-family homes

#640

Post by kleton »

antonymoose wrote: post #161
kleton wrote: post #63

They will continue trading the ones they have as LLC holding companies.

This guy wholesales ;) I recently worked on an MVP for a Zillow-for-wholesale startup. As a curveball, our state passed a law restricting where and how these contract-to-buy sellers operate. So their workaround, after consulting lots of lawyers, was to provide a standardized LLC / Contract flow such that you’re no longer marketing a house for sale. You’re marketing a stake in an LLC, only that LLC has a sole purpose…

I didn't know about this use-case. But this is also what investors do with real estate in California because Prop 13 resets the taxable value on a real estate sales, but not on buying an LLC that holes the real estate.
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