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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

#791

Post by razingeden »

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…

A better example than Blackrock is Arrived:

"The Arrived team is cracked, and I love the audacity of their vision: a stock market for real estate," said Ali Partovi, CEO of Neo, in a release. "I'm betting on them to democratize and digitize access to America's $50 trillion in residential real estate." [0]

Should housing be a “$50 trillion” market for fractional ownership, bundled with its own secondary/speculative market to turn around and flip like penny stocks?

Lovely knowing I can have “access” to that platform and own a 0.004% share in a house someone somewhere out there lives in (rents). While I’ll probably never own a house again.

[0] https://www.cnbc.com/amp/2025/11/13/arrived-launches-trading...

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

#792

Post by Nursie »

jmyeet wrote: post #786

So there are (at least) six important aspects to the housing crisis. 1. Politically, this issue is a winner and it's crazy that the Democratic Party has refused to bang the drum on this, basically because it potentially upsets corporate donors. They have instead ceded this poopulist political ground to the Republican Party. The Democratic Party does not want to win elections and this should never have been more obvio…

> There are people who bought a house for $100k in 1990 where that house is now worth $2M. Are you $1.9M richer? No.

This is often repeated but not 100% correct.

You are in fact richer, and you can leverage this $2m in equity to take on debt and buy more houses. This is what has been happening here in Australia, and it's a major factor in the continued rise in prices.

When you've done this, hung on a handful of years and all of your houses have gone up 20-50%, you can cash out for a very nice sum indeed. AFAICT this is now a pretty mainstream middle-class retirement plan in this country, and it's terrible because, as you point out -

> Increasing house prices are simply stealing from the next generation

The money is coming from people, usually younger people, who are funding the insane market with ever larger mortgages and staying in rental properties longer, both of which benefit the equity-holder.

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

#793

Post by markdown »

ryandrake wrote: post #250
oceanplexian wrote: post #195

Earlier quoted context omitted.

> But most of the "investors" buying up property are individuals purchasing investment properties. Maybe they should clamp down on that as well, especially individuals who are only purchasing SFH in residential neighborhoods as a way to park their overseas cash.

Exactly. Nobody wants to hear this, because we're all Temporarily Embarrassed Landlords, but if a corporation buying 100 houses to sit on and extract rent is bad (or good), then 100 individuals each buying 1 house to sit on and extract rent must be equally bad (or good).

Just allow people and corporations to own any homes they build. That way we can all still hope to be landlords with a hundred homes.

So long as landlords grow their business by increasing the total stock of housing, no harm is done.

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

#794

Post by em-bee »

compsciphd wrote: post #180
em-bee wrote: post #171

Earlier quoted context omitted.

the owner could rent out their own house and rent someone elses. it does make sense if you want to save a nice retirement home for yourself or a place where you want to raise your children while you work and live somewhere else.

that only works with a complete loop of landlord/renters and hence doesn't help anyone rent who can't own themselves....

right, i was just trying to point out that it would not make renting single family homes illegal.

it doesn't have to be a closed loop though. owners could be (and in my example most likely would be) renting an apartment/flat in the city which is not privately owned)

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

#795

Post by AngryData »

WalterBright wrote: post #325
observationist wrote: post #283

Earlier quoted context omitted.

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…

> 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. Raising prices when you only have a tiny portion of the market does not work. People won't buy them when there's…

You don't have to control the whole market to manipulate it. Housing is localized and the ideal situation is people hold onto their homes for decades before going on the market again and spend months if not years looking at purchasing a home. But investments into single family homes operates on completely different timescales and pace with an entirely separate list of considerations and values.

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

#796

Post by spaethnl »

twoodfin wrote: post #542
kart23 wrote: post #432

Earlier quoted context omitted.

Can someone please explain to me a practical way to apply the LVT? Vancouver used to have an LVT, it was too low and there was a housing speculation bubble in the early 1900s, since property was appreciating much faster than the tax rate. And if the LVT is too high, then you will have very little new development. This isn't even mentioning how you determine the value of the land. Denmark has an LVT and copenhagen aff…

As far as I can tell, LVT only achieves what it sets out to do if it’s equivalent to market rent. As in, you never really “own” your land, you’re just renting it from the sovereign. If you can’t make good enough use out of it to afford that rent, you should move on. You can find comments on this thread that make this argument explicitly in terms of “maximizing land use efficiency”. This was the economic structure of…

How is that LVT "rent" different from any other traditional property tax being "rent"?

As near as I can tell, it is just a different way of deciding how the property tax burden is levied.

Downtown property gets taxed much more. Un-developed speculation property that doesn't contribute to the community (and derives value from other people's contributions) get taxed at the same rate as nearby developed property.

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

#797

Post by kgwgk »

ctoth wrote: post #584
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…

Ownership share is a stock. Prices get set by flow - transactions. Housing is a thin market; maybe 5-6% of homes change hands in a given year. Price discovery happens at that transaction layer. Institutional investors own ~3% of single-family rentals nationally. But per CoreLogic they're 29% of purchases in the starter home tier. That's the market where we first-time buyers actually compete. In some metros it's more…

> Institutional investors own ~3% of single-family rentals nationally. But per CoreLogic they're 29% of purchases in the starter home tier.

Not true. That 29% is “investors”. Only one fifth of those transactions are from “institutional investors”. It’s mostly evil non-institutional investors, who also own ~97% of single-family rentals.

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

#798

Post by ropable »

jmyeet wrote: post #790
ropable wrote: post #570

Earlier quoted context omitted.

In Australia we've treated the family home as an investment, a primary mechanism for wealth creation (rather than an essential for life) for far too long. I fully agree that supply is the #1 driver for housing affordability, but like many things it's mult-factorial. Tax incentives, market forces, town planning, land use regulation, etc. all play their role. I'm hopeful that successive governments over here show the c…

> In Australia we've treated the family home as an investment That's true of most of the Western world, unfortunately. > a primary mechanism for wealth creation I don't disagree but this needs to be correctly framed publicly as simply stealing from the next generation because that's what it is. > Tax incentives For anyone unfamiliar, Australia has a system called negative gearing . In the mid-2010s the then Labor par…

Good points, thoughtfully made. As a resident of Perth, I (largely) endorse that description.

So much of the wealth of our middle- and upper-class is dependent on property ownership and rent-seeking, it's depressing. That population essentially needs to vote against their own self-interest to help improve housing affordability, so it's hard to see that ever happening. The best I could foresee is a government forecasting a stepped reduction of relevant tax benefits over time (e.g. in three years negative gearing gets reduced by half, then half again the following year, etc.) and then future governments honouring that commitment. As you pointed out though, it's a surefire way for any Australian political party to shoot themselves in the face.

I sometimes wonder how strong the demand needs to get for more-affordable housing before the market responds enough to matter. State and local govt could likely have a role in unlocking infill developments and increasing the allowed densities, but I'm not plugged into the planning system. I also strongly agree that state government should be more proactive as a housing supplier (in conjunction with private industry).

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

#800

Post by whatshisface »

EugeneG wrote: post #358
observationist wrote: post #283

Earlier quoted context omitted.

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…

“properties get leveraged, instrumentalized, and securitized, with derivative products, speculation, and all sorts of incentives” Spoken like someone has no clue what they are talking about and just throwing out jargon

The truth is that BlackRock buying rental properties is the opposite of that. The foundation of the MBS market is in its name: mortgages.
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