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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

#291

Post by jwarden »

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…

But housing is an investment, and a shelter. Discouraging housing as an investment discourages investment in housing.

What I think you are trying to say is that it is preferable that the investment in housing be made by the people who are going to live in the house (or by the government) and not by entrepreneurs.

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

#292

Post by NSMutableSet »

jjcm wrote: post #223
i1856511 wrote: post #106

It should be illegal to own more than two homes.

Nearly impossible to regulate, and too rigid to boot. Does a duplex count as two? If so that means triplexs higher MUDs are illegal, which will harm low income housing options. Can companies own property? If so then the problem is easily escapable with a simple LLC. If not, then either existing ones have to be grandfathered, or the housing market is going to be flooded with corporate housing. The better approach is t…

>Nearly impossible to regulate, and too rigid to boot.

No it isn't.

>Does a duplex count as two? If so that means triplexs higher MUDs are illegal..

Why would it count as more than one? You can own a duplex or triplex or whatever as your primary home, and then you have the option of renting out portions to generate additional income, or fully occupying the entire thing. If you have no plans to rent out units, it would make more sense to convert it.

>which will harm low income housing options.

It will harm landlords who depend on the current system. Low income housing won't be necessary when homes are affordable for everyone.

>Can companies own property?

Not homes.

>or the housing market is going to be flooded with corporate housing.

Good.

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

#293

Post by paxys »

VirusNewbie wrote: post #226

What's nuts is not just that investors get to buy homes, but that its tax advantaged to do so. Between prop 13 in California, to 1031 exchanges, there are plenty of reasons to invest in RE over even say the stock market. I don't get to do a 1031 exchange for my Meta stock into AAPL or something...

You forgot the biggest one – cheap mortgages backed by unlimited money printing. Ever since 2008 loading up on as much <3% housing debt as you can afford has been a no-brainer investing strategy.

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

#294

Post by brianwawok »

quantified wrote: post #95
boringg wrote: post #67

Earlier quoted context omitted.

Depends on where you live - this "renting is a poverty trap" only applies to certain places and depends on home values constantly increasing. If home values crash where you live then you spent years putting money towards a worthless asset.

Renting is always worth 0 as equity, so it's a total loss regardless.

* It guarantees you do not lose money if the home values around you drop

* It gives you a fixed monthly houseing cost. No "10k new roof" or "1k new stove" suprises hit you.

* If you are say, saving 50% vs buying, you can put this difference in an index fund. This would over 10 or 20 years potentially give you a LOT of money over buying.

Look, buying is mostly great. It's one of the biggest builders of wealth for most Americans. But from a purely numbers game, it's not so clear "rent is just losing money".

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

#295

Post by anoonmoose »

hotpotamus wrote: post #169
anoonmoose wrote: post #122

Earlier quoted context omitted.

> Here's a house in Indiana for $125K Laketon, IN, population 606, had its post office closed in 2010 and, from a quick perusal of Google Maps, probably doesn't have a single traffic light. Doubt there's much public transit out that way. Only 30 miles to a town I might be able to get a job in, though...

Are you not able to work remotely? Or is that too much remote?

Combo electrical engineer and embedded firmware engineer, who spent the previous ten years in production test engineering...nah, my job is pretty hands-on. I went into a pretty empty building during most of 2020 and 2021 five days a week.

I mean, I've got a few skills that might be sharp enough to get me a remote job but I really like the hardware world.

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

#296

Post by bennysomething »

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…

So should we do the same with food too?

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

#297

Post by alexb_ »

giantg2 wrote: post #269
slg wrote: post #131

Earlier quoted context omitted.

Yes, the investors are the symptom and not the cause. They are going where the money leads them. However a big problem with institutional investors is that they also institutionalize NIMBYism. They won't just block housing in a select neighborhood, they will block housing everywhere and they put more pressure on the federal government to ensure that housing is protected as an investment class. Both will contribute to…

"Sure, many object to new housing for reasons like "it will change the character of the neighborhood". But many others object because they are worried about the value of their own home going down." At least in my area, it's all about people wanting the area to remain semi-rural. They generally aren't opposing low density SFH in independent builds. The people in my area are against many development and medium density…

A lot of what I've seen is people worried about "low quality tenants" (read: people who don't look just like me)

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

#298

Post by ineptech »

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…

I agree, and I feel like limiting the mortgage interest deduction to owner-occupied homes would get us most of the way there at the stroke of a pen. It's a huge subsidy and I can't think of any good reason to extend it to rentals and investment properties.

In fact, we should probably repeal it altogether - in theory it subsidizes home ownership for the poor and middle class, but in practice the only people who take it are those who itemize deductions, which the poor generally don't.

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

#299

Post by thepasswordis »

Dracophoenix wrote: post #260
nineplay wrote: post #170

Earlier quoted context omitted.

I'm with you friend. Posters throw out lines like "property shouldn't be an investment" as though the idea that property has intrinsic value is something invented in the last 50 years or so, not something that has been true for millennia. I've been told that "housing is a right" which, if conceded, still runs into your point - housing may be a right, housing in the most expensive and populated areas in the US is not…

> I've been told that "housing is a right" An easy reply to these same people is to ask if they think they have a right to wood, brick, concrete, sewer pipes, electrical wire, all the other materials that go into making a livable house, and, on top of that, if they think they're freely entitled to the labor required to construct a house out of these properties.

Their reply is that the land beneath the house shouldn’t be available for private ownership.

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

#300

Post by buscoquadnary »

crisdux wrote: post #162
infogulch wrote: post #100

Housing is at the root of many of the rich world’s problems (2020) | 379 points | 6 days ago | 794 comments | https://news.ycombinator.com/item?id=32493549 On this post I wrote: > A couple ideas for how to fix some real estate problems: > 1. A zoning rule that requires home owners to live in the owned home. ... And the general response? > The mega reit buying residential properties is also overblown. 70% of rental pr…

The high rate of rentals owned by individual investors is bad too if our goal is to maximize the number of home owners. I know a lot of people in my cohort who bought and moved into a new home, but kept their previous home as a rental. IMO this option is only accessible to large amount of people during this unique time because of government policy, ultra low interests rates, and societal trends. I think a large part…

It will be interesting to see how that plays out now that interest rates are rising. Honestly it feels a lot like 08 all over again. Somebody decided to go and get another home as an investment property, they leveraged themselves but took advantage of the low interest rates and a 20 year mortgage, it was a smart idea at the time, prices kept going up, they could just keep bumping rent because where would anyone else go, everywhere was getting more expensive.

Interest rates go up, there are problems with people affording the rent, suddenly their unit is sitting vacant for a month, or two, or three. They drop prices to increase interest, it isn't enough. Suddenly they need to flip the house, but because interest rates have gone up demand has gone down, everyone who was getting on the rental property gravy train suddenly isn't so interested when they're paying 8% instead of 2%, so the house is underwater. The bank forecloses and sells the property for cheap they don't want houses they want money, this means demand for other houses that are now overpriced becomes even lower, the dominoes keep falling. Suddenly tons of people that looked to the RE gravy train find themselves in over their head for taking out debts that seemed like a good idea at the time.

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