Zillow seeks to sell 7k homes for $2.8B after flipping halt • Hacker News Board

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#421

Post by djmips » Tue, Nov 02, 2021, 6:51 PM UTC

batshit_beaver wrote: post #166

whimsicalism wrote: post #114

Earlier quoted context omitted.

My ideal is for real housing prices to remain somewhat steady - ie. I don't like that I have to pay much more than inflation to get a house compared to what my parents pay. It'd be nice to be able to afford a house where I grew up without having to tie a ridiculous amount of my net worth up in this one very pricey illiquid asset, even if I could get the mortgage.

We have 1) inflation and 2) population growth. Given the limited amount of resources, land, and labor, why on earth would house prices remain steady? You'd need at least one of these factors to be reversed, or demand for standalone housing to go down for cultural or economic reasons, before you see long term downward trends. In general though I agree with the poster above that the affordability "crisis" is really an…

That's so much hogwash. You're telling me a million dollar rundown craptastic house in Vancouver is the BEST house?

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#422

Post by acdha » Tue, Nov 02, 2021, 6:52 PM UTC

ajsnigrutin wrote: post #415

game_the0ry wrote: post #328

Earlier quoted context omitted.

> I don't think I've ever heard of a politician even talking about that though You have to consider that legislative members tend to own property and tend to be baby boomers. They are far removed form the experiences that younger generations have to deal with - from their perspective, their home value can go up 20% in 2 years and that will be rationalized as a normal market. They are not talking about it because they…

Most baby boomers (the ones getting all the blame) usually own one house, that they live in... even if the value goes up, they need a place to live in, and the high prices are pretty much everywhere, people actually want to live. The only ones profiting from baby boomers are their kids when they inherit the houses. Politicians are probably getting paid of by companies investing in housing and buying up hundreds or th…

> even if the value goes up, they need a place to live in, and the high prices are pretty much everywhere, people actually want to live. The only ones profiting from baby boomers are their kids when they inherit the houses.

This leaves out one major factor: they need somewhere to live but that doesn't mean it needs to be the same real-estate market or size. Someone who sells a house large enough to have a family in a major market and retires to a cheaper market can see a very comfortable return. Probably nowhere near enough to make up for the other impacts of the policies people voted for to drive up their home value but it's harder to get people to give equal weight to different factors when one of them will show up directly in their personal bank account.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#423

Post by game_the0ry » Tue, Nov 02, 2021, 6:52 PM UTC

trident5000 wrote: post #302

game_the0ry wrote: post #255

Former real estate finance professional, here. If you were hoping this was a sign of the real estate market falling and perhaps its your chance to get a bargain, think again. > The company is seeking roughly $2.8 billion for the houses, which are being pitched to institutional investors, according to people familiar with the matter. Institutional investors (Blackstone, Blackrock, Colony, et al) will be being in bulk,…

Thats not how you look at this. If this were a strong market signal they would be selling to Blackrock at a profit and not a loss. The exchange value is down not up. There were equal buyers matched to sellers in 2008 as well when the market was cratering (not that we are in 2008).

When an institutional investor like Blackstone or Blackrock or Colony Capital calls your phone to express interest in an asset you own, I can all but guarantee you that you are in a distressed position and looking to sell.

They have enough experience, data, and skill to time the market cycle. Companies like Zillow do not.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#424

Post by t-writescode » Tue, Nov 02, 2021, 6:53 PM UTC

BizarroLand wrote: post #197

ineedasername wrote: post #159

Earlier quoted context omitted.

I'm not so sure: At current rates, assuming excellent credit, that's about $1700/month. If you're anywhere near the suburbs of a city, you can add another $500 to $1500/month in property taxes, and sometimes another $100 to $400/month in HOA fees. on that for a total pre-utility rate of ~$2400-$3600/month or roughly $30k to $43/ year. I live in the higher end of that range even though I'm in a modest home in a lower-…

I think you're overlooking married millennials, many of whom are in their late 20's-late 30's and many of whom have no children, and many of whom are two-income families. A $400k home would be quite affordable if each of them were earning an average of $24/hr or more, which isn't too crazy.

I, singularly, make far more than $48/hour ( which is 96k / year ); and, a 400k home is barely in _my_ price range, with the HOA and property taxes included.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#425

Post by kennywinker » Tue, Nov 02, 2021, 6:53 PM UTC

munk-a wrote: post #345

ep103 wrote: post #321

Earlier quoted context omitted.

They are generally called non-primary residency taxes, and they're definitely a thing, and definitely getting more publicity, and most definitely need to become much stronger and more widespread.

We have these in BC - they were adopted in response to overseas real estate investment (and other factors) driving the Vancouver housing market insane. Canada also has a number of programs that make property purchase for new homeowners more affordable by waving some taxes and allowing interest free borrowing from your retirement fund. So the fight to keep housing affordable for everyone is a difficult one. One of the…

> Canada also has a number of programs that make property purchase for new homeowners more affordable by waving some taxes and allowing interest free borrowing from your retirement fund

Some further flaws in the system: I was shocked to find out that the new home buyers tax credit only applies to homes under $500k - which in vancouver means it only applies to a handful of small condos. It's also not poolable, so two first-time buyers going in on a $501k condo are disqualified.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#426

Post by nojito » Tue, Nov 02, 2021, 6:54 PM UTC

t-writescode wrote: post #350

nojito wrote: post #300

Earlier quoted context omitted.

>at a steep discount before they even hit the market This isn't really true. They are paying above market rates and have been for the past 18 months or so.

Isn't the easiest way to make market rates higher is to, en masse, over-pay to force everyone into thinking that the house is worth more, Thinking Fast and Slow style?

They aren't in the market to flip in the short term though.

They genuinely believe that these assets will appreciate in the coming years.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#427

Post by preinheimer » Tue, Nov 02, 2021, 6:55 PM UTC

munk-a wrote: post #345

ep103 wrote: post #321

Earlier quoted context omitted.

They are generally called non-primary residency taxes, and they're definitely a thing, and definitely getting more publicity, and most definitely need to become much stronger and more widespread.

We have these in BC - they were adopted in response to overseas real estate investment (and other factors) driving the Vancouver housing market insane. Canada also has a number of programs that make property purchase for new homeowners more affordable by waving some taxes and allowing interest free borrowing from your retirement fund. So the fight to keep housing affordable for everyone is a difficult one. One of the…

> but over time these policies tend to settle in a place where thing are more affordable.

Could you point me at some more reading that talks about this? The increase in prices makes perfect sense to me, but I don't really have a good handle on why things would come back down.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#428

Post by t-writescode » Tue, Nov 02, 2021, 6:56 PM UTC

ct0 wrote: post #129

gizdan wrote: post #38

Earlier quoted context omitted.

5% is still $20k. When you're living payslip to payslip, even $5k is too much as a deposit is too much.

But 5% is better than 20% down. Most have the capacity to save but choose not to.

5% down on a 400k place is 20k.

Sure, I suppose someone earning a normal wage could scrounge together 20k in, let's say, 5-10 years, but then they would use *ALL* of their savings and have no emergency fund anymore, to use that 20k. Further, then you look at all the costs you get hit by when buying a house such as closing, etc, and that 20k turns out to be 28k, so they'll need to save for even more years.

And now the house isn't 400k, it's 450 or 500, so instead of 20k, they instead need 25k, and with closing costs, now it's 35k because those went up proportionally, as well.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#429

Post by tata71 » Tue, Nov 02, 2021, 6:57 PM UTC

mullingitover wrote: post #309

BuckRogers wrote: post #272

Earlier quoted context omitted.

I'm a 39 year renter flush with cash from 15 years of a professional job while living in austerity for the entire time. Soliciting free advice. You sound bullish so I wanted to share five risks in the short term that have been on my mind lately: 1) Evictions now allowed in 43 states after a pandemic moratorium on them. My state allowed them October 3rd. Supply. 2) A China conflict at any point. Disruption. 3) Taxes g…

> 4) Rates going up to counter inflation. I want this one since I have cash and don't care if rates are 2% or 20%. You're likely making a bad bet by holding on to cash. The inflation and low rates are doing their job for the most part by driving investment and spending, and you're swimming against the current by doing exactly what you're not supposed to be doing: hoarding cash. > 5) Vaccine mandate job losses. Supply…

> We're already back to full employment. These threats of en masse departures haven't really materialized

This is not universally true.

Re: Zillow seeks to sell 7k homes for $2.8B after flipping halt

#430

Post by lostapathy » Tue, Nov 02, 2021, 6:59 PM UTC

shiohime wrote: post #396

cwkoss wrote: post #384

Earlier quoted context omitted.

Every person or corporation that owns more than one residential dwelling should pay increased property taxes based on the number of residential dwellings they own. This is an easy problem to legislate away, our politicians are just too cowardly to decommodify housing.

There are probably easy loopholes to get around your suggestion. Just form another LLC and purchase the property under that LLC instead of you as an individual, then each entity owns only one property, so they get the standard tax rate instead of what you are proposing. Of course this would be a giant pain of a workaround to scale, but for the non-mega corporations it'd probably work. I'm sure that the huge corporati…

Just tie the "first home" tax exemption back to a person by making business entities a pass-through to the registered agent (or some other single officer). i.e., an LLC can't claim the exemption, but the agent can pass their exemption through the LLC to a property.