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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

#531

Post by LAC-Tech »

rgmerk wrote: post #165

It will make very little difference in the end. Australia's land tax system makes it effectively impossible for large corporations to own large chunks of residential property, but our real estate is amongst the world's most expensive and landlords are still awful - it's just that the landlords are hundreds of thousands of dentists and, yes, software engineers rather than corporate entities. If you want housing to be…

Don't be a coward, and talk about demand for housing, which in Australia is driven by sustained mass migration.

The inevitable outcome of this is increasing homelessness, and likely slums when homeless just start building themselves make shift shelter in such large numbers that authorities can't stamp down on it.

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

#532

Post by weakfish »

DoesntMatter22 wrote: post #344
rgmerk wrote: post #221

Earlier quoted context omitted.

You would feel that, but you would be wrong. Small businesses are often just as ruthless as large ones, just less competent. In any case, most rental properties are managed through agencies, who are soulless profit-optimisers.

So what’s your solution exactly? No businesses at all?

That’s… not what they said, you’re putting words in their mouth

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

#533

Post by presentation »

63 wrote: post #158
mattmaroon wrote: post #118

Earlier quoted context omitted.

Banning people from other countries buying home is both more sensible and more practical than this, which is why very many countries do it.

"From" other countries is overly broad and I assume not what you intended. I am actually interested though in the idea of legislating how frequently home owners have to actually be within range of the home, for example. A friend has had a hell of a time with a landlord in Malaysia who's never seen the property.

Citizenship or long term visa would immediately cut out 90% of the foreign speculators I imagine.

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

#534

Post by yalogin »

How is Wall Street defined? How would they enforce it? What is preventing a large corporation from registering a new company to buy every house? Also this is just a call to action, nothing written up in a law yet. We will see how it goes, if at all it's implemented.

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

#535

Post by triceratops »

jimbob45 wrote: post #471
roywiggins wrote: post #162

Earlier quoted context omitted.

Would that not make rental properties entirely illegal? That seems... complicated

Rental single-family homes should largely be illegal. Short-term housing should be largely limited to apartment buildings and more space-economic structures. Littering the landscape with empty houses only helps bank accounts. Still, I'm more than cognizant that there must be huge exceptions carved out for any of these ideas.

You find it hard to believe people may want to live in single-family homes temporarily? Or live in them without worrying about maintenance?

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

#536

Post by rayiner »

observationist wrote: post #283
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…

It's not that simple - the problem is that those institutions are market makers. 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. The things that they do have mass…

A “market maker” provides liquidity that allows trades to clear and keeps prices stable. They make money on the bid-ask spread. They don’t have leverage to raise or lower prices.

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

#537

Post by fooker »

yalogin wrote: post #534

How is Wall Street defined? How would they enforce it? What is preventing a large corporation from registering a new company to buy every house? Also this is just a call to action, nothing written up in a law yet. We will see how it goes, if at all it's implemented.

The modern US government runs on vibes, not definitions and enforceability!

(And no, this is not a Trump thing. This has been the case for a while now.)

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

#538

Post by johncolanduoni »

observationist wrote: post #518
tptacek wrote: post #478

Earlier quoted context omitted.

You're telling a just-so story, and you can tell because there isn't a simple schematic 1-2-3 story you can make from this about how these people exert control over home prices. Words mean things; wielding scarcity requires you to control enough inventory to manipulate scarcity, and REITs and corporate buyers empirically don't. I get why people like telling stories like this: it suggests there's a single boogeyman th…

I don't mean to convey that it's intentional. There's no conspiracy of cigar smoking financiers in tuxedos smoking cigars in dark rooms. It's just like the Carlin observation - there doesn't have to be a big conspiracy. They just know what's good for them. They behave accordingly. The do things that they can, and because those things are relatively new, it's a type of information asymmetry and policy / good intention…

How do I distinguish the world where institutional investors are meaningfully contributing to high housing prices and the world where they aren’t? Is there some metric you’ve seen that substantiates the mechanism? For example, are they only 1% of holders but 50% of trading volume or something?

Because if I saw a house 15% below market where I live, I would buy it (to live in). I don’t imagine I’m the only one. Institutional investors can’t stop me from doing that if it’s offered - can they stop the seller from offering that?

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

#539

Post by mcherm »

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…

> if it's democratic like that I'm mostly OK with it

One thing to keep in mind. It might be that it's "democratic" in that all the homeowners are allowed to vote for or against the zoning policy (or for or against the local leaders who set zoning policy) but ONLY the local homeowners are allowed to vote. Those who rent (or who can't even afford to rent) live in a different district and aren't allowed to participate in the election.

If that's the case, then voting doesn't represent "the will of the people", just the will of those people permitted to participate.

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

#540

Post by presentation »

tootie wrote: post #239
tptacek wrote: post #176

None of this has anything to do with "affordability", which is not about shifting rentals to owner-occupied properties, but rather reducing the monthly cost of residing in areas with opportunity. The notion of home ownership as an absolute good is a driver of unaffordability.

Yup. Building wealth through home ownership directly implies homes becoming unaffordable for new buyers.

I agree philosophically though there is a lot that can be done short of upending the entire American wealth structure like removing barriers to housing construction (to dramatically increase supply) as well as subsidizing first time buyers eg with preferential mortgage rates and tax write offs.
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