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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

#381

Post by kiba »

bs7280 wrote: post #277
sharpy wrote: post #265

Earlier quoted context omitted.

That sounds nice, but I think that increased tax will just be passed down as higher rent.

That is a good point, and this tax would need to be well thought out. I specifically would increase the tax rate the more properties an entity owns (Not a lawyer so IDK how to treat one guy owning 10 companies as 1 entity the right way). That way smaller local landlord's can still exist (and keep rental prices competitive), but massive orgs will be forced to sell properties. The idea is to create a disincentive for h…

The problem is not owning multiple properties, but untaxed land ownership. There's a prexisting solution for what you want to solve. It's called the Land Value Tax, which imposes a tax on land, but not on buildings and other improvement.

Property tax has a known problem of taxing improvement in addition to land, which constrict urban development. Plus, imposing additional property tax means improvements are further penalized, which means efficient land ownership are penalized.

You should look up Georgism and read up on what they have to say. It's a reaction to the 19th century economic condition but it very much apply to our 21st century situation and even more relevant today.

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

#383

Post by epistasis »

piker wrote: post #317
epistasis wrote: post #286

Earlier quoted context omitted.

There are well over a million homes in the metro Atlanta area. If the top three owners have less than 4% of a market, need if they act in a completely coordinated manner they have approximately zero market power.

Yes if the market is for rice, but illiquid assets are an entirely different market which can be crazy warped by a few important participants.

How so, could you explain that a bit? I could see them causing a price dip or spike in purchase prices if they bought or sold all at the same time, but that would affect their own prices that they pay or receive, right? What is the market manipulation with 4% of housing stock?

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

#384

Post by estearum »

indymike wrote: post #296
bs7280 wrote: post #260

Earlier quoted context omitted.

I propose two changes to (try) and broadly solve this: - Additional property tax if you do not live in your home fulltime. This includes vacation homes. - First time, US Citizen, non-corporate homebuyers can get a loan at the federal interest rate. If I were to try and buy the condo I rent, due to interest rates, taxes, and HOA's I would be paying $1000 more per month. At the end of my mortgage I would given the enti…

> Additional property tax if you do not live in your home fulltime. In states I've lived in with property tax there is a homestead exemption for the house you live in. In my current state that's about twice the tax. The effect: Rent goes up to cover the tax and margin is added, so the rent goes up more than the tax. >Rich investors and companies effectively get to buy homes at a discount vs average joes. Usually the…

> The effect: Rent goes up to cover the tax and margin is added, so the rent goes up more than the tax.

Well-established effect and it applies to everything. A huge portion of all technological improvement/productivity gains and nearly all public investment money ultimately accrues to land rents which we then later just call "the cost of living."

https://en.wikipedia.org/wiki/Henry_George_theorem

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

#385

Post by tshaddox »

kiba wrote: post #334
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.

Landlord, or property management, is a job, same as any other job you might have. The problem is not owning multiple properties, but not paying enough taxes on land. Otherwise, landlords benefit from the free lunch that comes with economic growth and real estate price appreciation, which is true for every homeowners in this country. IF you want affordability? Tax land. Doesn't matter who owns them. Your grandma or wa…

> Landlord, or property management, is a job, same as any other job you might have.

Let's ignore property management for now and focus on landlords (i.e. people who own homes and collect rent from the people who live in the homes). That is very much not the same as any other job. Most jobs do not consistent entirely of literally rent-seeking.

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

#386

Post by milesskorpen »

bs7280 wrote: post #260
roadside_picnic wrote: post #48

The key word here is "Wall Street". And this statement is playing off a popular misconception around corporate investors buying up American houses. There has been a bit of a panic around "Investors buying up all the property!!!" With people often citing Black Rock and Blackstone as the main culprits. But most of the "investors" buying up property are individuals purchasing investment properties. Here's an article on…

I propose two changes to (try) and broadly solve this: - Additional property tax if you do not live in your home fulltime. This includes vacation homes. - First time, US Citizen, non-corporate homebuyers can get a loan at the federal interest rate. If I were to try and buy the condo I rent, due to interest rates, taxes, and HOA's I would be paying $1000 more per month. At the end of my mortgage I would given the enti…

But you'd have an asset you own at the end of that period, and your mortgage payments wouldn't go up over time whereas rent likely would.

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

#387

Post by ricardobeat »

WalterBright wrote: post #292
bs7280 wrote: post #260

Earlier quoted context omitted.

I propose two changes to (try) and broadly solve this: - Additional property tax if you do not live in your home fulltime. This includes vacation homes. - First time, US Citizen, non-corporate homebuyers can get a loan at the federal interest rate. If I were to try and buy the condo I rent, due to interest rates, taxes, and HOA's I would be paying $1000 more per month. At the end of my mortgage I would given the enti…

> Rich investors and companies effectively get to buy homes at a discount vs average joes. Suppose you had $100,000 in cash, and buy a house for $100,000. You'll not be paying 5% interest on a mortgage. But if you did not buy the house, you would be investing that $100,000 for a 5% return. So, you're either paying 5% on the mortgage, or foregoing 5% return for investing that money. The rich person is not getting a di…

Except they do, as the original comment already said. The rich “person” has cash and access to much cheaper credit, is buying multiple properties, not paying the bills and earning rent, the other will have a mortgage.

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

#388

Post by GolfPopper »

mbesto wrote: post #312
roadside_picnic wrote: post #48

The key word here is "Wall Street". And this statement is playing off a popular misconception around corporate investors buying up American houses. There has been a bit of a panic around "Investors buying up all the property!!!" With people often citing Black Rock and Blackstone as the main culprits. But most of the "investors" buying up property are individuals purchasing investment properties. Here's an article on…

Also, the headline on HN is downright wrong. "US will ban Wall Street investors" != "Trump says he will ban Wall Street investments..." This a Truth Social post from the President. It doesn't mean it has happened, will happen or will happen in the form that either Trump says it will or is being implied here. This is a very difficult issue to properly address for lots of legal/logistical reasons. For example - many le…

After a decade of national politics, and many decades of his "business", too many people still take "Trump says" as anything more than a piece of a con.

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

#389

Post by tshaddox »

nospice wrote: post #207
chucksta wrote: post #154

Earlier quoted context omitted.

Depends where you are https://www.wsbtv.com/news/local/henry-county/3-companies-ow... |“I’d say at least 60 percent of the homes around here are owned by corporations,” Clark said.

"Corporations" is meaningless in this context. If you want to own a rental home in the US, you should set up an LLC, both for liability reasons and because it makes it easier to deal with taxes and expenses. In the parts of the country I lived in, I've never seen big corporations own single-family rentals en masse. They usually go for apartment complexes, which are far more profitable if you have the capital to buy /…

That's not really meaningless though. You just explained in more detail some attributes of corporations, many of which are precisely the things many people are criticizing when they criticize the fact that corporations own lots of housing. Of course we all know that there are still humans behind the corporations.

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

#390

Post by FireBeyond »

WalterBright wrote: post #349
iknowSFR wrote: post #309

Earlier quoted context omitted.

Couple things to add. First, rates are much lower when you’re leveraging 10,000 homes at 3:1. That allows you to purchase 20,000 additional homes, which isn’t something the normal individual can do. Second, most of this borrowing was done during the 0% interest days and when rates went up after Covid, a lot of the operations grinded to a halt. Third, there’s no regulatory environment for rent rates and rate increases…

> First, rates are much lower when you’re leveraging 10,000 homes at 3:1 What interest rate do you think rich people are getting? As for the Covid interest rates, those were available to everyone. Third, we're talking about buying houses, not renting.

> What interest rate do you think rich people are getting?

Depends how rich. Banks have long been known to offer below market or even zero interest loans to the richer segments in exchange for/in the hope of securing other business from them.

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