Yield-chasing investors are snapping up single-family homes, driving up prices
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Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#2This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing.
One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over the long term
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#3This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
> Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls.
This sounds like a good thing to me. Why will it turn out badly?
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#4This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
> and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing.
Call me skeptical, but I don't think the average person would share in the benefit of that efficiency.
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#5This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
> Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. This sounds like a good thing to me. Why will it turn out badly?
The ones most affected by the changes (tenants affected by zone changes) have no skin in the game. As soon as situations turn sour, they move, they dont fight. Why establish roots anywhere, why call a community your home if its owned by a corporation?
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#6This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
I live in Houston (which is where the article takes place). We don’t have rent controls. In fact, I’m not aware of any in the state of Texas. If there are any they are minuscule.
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#7This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
> and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. Call me skeptical, but I don't think the average person would share in the benefit of that efficiency.
I’ve moved every 12-18 months for the past 10 years and rented everywhere. I’m one datapoint but apartments/property managers have been way better than private owners. The private owners always seem to be figuring out for the first time how to repair anything, always trying to save money, and have always tried to hold my deposit illegally. I’m pretty sure when these landlords talk to each other about “having someone else pay your mortgage” they also swap strategies and excuses to keep the security deposits. Corporate landlords otoh have their own repair people, processes to get repairs done, and have always been reasonable about returning my deposit. Lately I’ve been avoiding renting directly from owners.
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#8This will turn out badly. Corporate landlords won't be able to lobby quite so fiercely against new construction, upzoning and rent controls. Otoh, their cost of capital is lower, and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. One useful thing though is that corporate owners dont need to sell, so transaction and mtg taxes will be lower over…
>Otoh, their cost of capital is lower
According to [1], the average rate (or prime rate?) right now is 3.18% for a 30 year mortgage. OTOH, rate for 30 year "High Quality Market Corporate Bond" is 3.38%.
> and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing.
They might be more efficient at being landlords, but that doesn't exactly translate into higher efficiency when it comes to providing housing. Owning a house and doing the repairs yourself is probably much cheaper than hiring someone to do it, not to mention you save all the taxes on the imputed rent.
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#9> driving up prices
... and property taxes.
Re: Yield-chasing investors are snapping up single-family homes, driving up prices
#10Earlier quoted context omitted.
> and they are more efficient managers than individual homeowners, so this might be a more efficient way of providing housing. Call me skeptical, but I don't think the average person would share in the benefit of that efficiency.
I’ve moved every 12-18 months for the past 10 years and rented everywhere. I’m one datapoint but apartments/property managers have been way better than private owners. The private owners always seem to be figuring out for the first time how to repair anything, always trying to save money, and have always tried to hold my deposit illegally. I’m pretty sure when these landlords talk to each other about “having someone…
From someone who grew up with parents that owned a hand full of rental houses and did all repair work themselves (quite competently, father is a tradesman anyway) : I am not at all surprised that individual owners tend to keep deposits at a higher rate. I don't think there's anything illegal about it : without fail, every single renter we have ever had has incurred damage to the house well beyond the security deposit. When a company owns a ton of properties, they have economies of scale- all the properties have interchangeable hardware, cabinets, etc they likely have suppliers for materials that give them more competitive rates for bulk purchases, they have workers who will do the repair work for minimum wage (whereas a single owner probably values their time in the range of 50/hr)
It makes a lot of sense, but I understand your frustration. Still not nearly as frustrating as hauling trailers full of other peoples trash and dog shit out of your own house and then having to repair thousands of dollars worth of damage to cabinets, drywall, carpet, and paint.