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If you sell a house these days, the buyer might be a pension fund

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Re: If you sell a house these days, the buyer might be a pension fund

#81

Post by alert0 »

adflux wrote: post #16

This is what happens when you keep printing money and keep mortgage rates incredibly low. All that money's gotta go somewhere. Hey, at least the CPI isn't going up right? Its only the most expensive thing in most people's lives that has doubled in cost in about 10 years. Same thing for stock prices, and slowly other commodity prices are catching up as well. Non-homeowners are being shafted by this fed/ecb policy. Eve…

Right now interest rates are low, they cannot use them as a tool in a crisis, for this reason they are printing money to lower the overall debt obligation of the US. Inflating away our debt. This will eventually lead to inflation at which point the interest rates will rise again (prediction, at the end of the decade). This is the correct play for where we are in the long term debt cycle. In my opinion, this is happening a little earlier than it should, but it might just be a sneak preview provided by the pandemic.

Stock prices are rising because the interest rates are so low. A ton of institutional money that was in bonds is now out seeking yield. This moves a ton of money into stocks and, as we see in the article, real estate.

The labor class has been shafted for years by the US dollar being the global reserve currency, causing us to run persistent trade deficits. This has off-shored manufacturing and gutted our capabilities. If the US weakens the dollar and rebuilds the manufacturing base, which they appear to be trying to do with the investment in semiconductors, I think we will be in a much better position. I am happy with the stimulus because it does both, weaken the dollar and invest in US capabilities. We just need to make sure it flows to the correct places.

Re: If you sell a house these days, the buyer might be a pension fund

#82

Post by digitaltrees »

fb13 wrote: post #59
alert0 wrote: post #43

Earlier quoted context omitted.

Rent control makes landlords very hesitant to add new people to a lease. Otherwise the unit can just be passed from friend to friend and never get back to market.

> Otherwise the unit can just be passed from friend to friend and never get back to market. I'm not sure how this is unfair. Considering the way capital gains are taxed after the sale it seems like the grandfathered-in rent controls are just a lever at the opposite end of the spectrum. But of course, we don't want to give any levers to the poors so it has to go.

We can want to support the poor and also recognize that prior attempts have unintended consequences or are ineffective. In this case rent control seems to reduce housing stock. The solution may be building more units so regulation should focus on that.

Re: If you sell a house these days, the buyer might be a pension fund

#83

Post by lotsofpulp »

nickthemagicman wrote: post #34
lotsofpulp wrote: post #14

Earlier quoted context omitted.

Property taxes do not have to go up because the assessment goes up. I have had assessments go up, but the tax rate go down because the town did not increase its budget. In the long run it probably will though, since higher land values will probably cause increases in wages and other costs. But it does not have to be proportionally as much as the land value increase.

The government has a claim to your property. The government is strongly influenced by lobbyists. The government is also gerrymandered. The government always needs more money. Why would your property taxes not continue to go up endlessly?

> Why would your property taxes not continue to go up endlessly?

I do expect them to go up endlessly, but I expect for everything else to also go up endlessly (in nominal terms).

Re: If you sell a house these days, the buyer might be a pension fund

#84

Post by RGamma »

Over are the days where supply and demand controlled allocation of resources to get the goods to every man, woman and child.

Big demand, lack of workers? Price and pay rise to meet the challenge. This part of market economy always made sense to me. Like a muscle growing stronger in response to increased exertion.

Now the wealthy have decided that this is way too boring because what good does it do them if people actually attain wealth for themselves? There'll be no motivation to run faster in their hamster wheels to create more wealth to be siphoned off.

Works as intended.

Re: If you sell a house these days, the buyer might be a pension fund

#85

Post by briefcomment »

recursive wrote: post #80
briefcomment wrote: post #72

Earlier quoted context omitted.

If you own all options and the renter needs to have some sort of housing, they'll pay anyway. The end result is that the owner will start collecting a larger percent of the renter's earnings.

I'd give up housing before food. There's a limit to how high that percentage can be.

The point is that landlords will be able to suck up the income that you spend on non-essentials and luxuries.

Re: If you sell a house these days, the buyer might be a pension fund

#86

Post by commandlinefan »

crazygringo wrote: post #69
commandlinefan wrote: post #4

This hurts people who already own houses, too - property taxes are assessed on the appraised value of the home, which is a function of what the similarly-sized houses in your area sold for most recently. My property taxes have increased 10% every year for the past several years (and it would have been more if not for a legislative 10% annual cap). I worry that there will come a day when I've paid off my mortgage but…

I really don't see how you're complaining -- the value of your home is going up way more in absolute terms than the property tax you're paying. If you don't have cash, take out a small mortgage on the house to pay the property taxes. You'll still come out ahead in the end.

That was a joke, right?

Re: If you sell a house these days, the buyer might be a pension fund

#87

Post by foobiekr »

briefcomment wrote: post #46
coverband wrote: post #5

This doesn't make a lot of sense to me. Why would an entity trying to maximize profits pay an extra 20-50% to purchase an illiquid asset?

Once you own all housing, what's to stop you from increasing rents?

The move BlackRock will do, based on their history, is to incentivize increases in adjacencies to drive value. What I mean by that is that they will, for example, encourage new office complexes in locations favorable to their new rental domains. Think SF bay area’s natural and warped logic locating massive complexes on the peninsula or ST instead of Fremont/San Jose.

Re: If you sell a house these days, the buyer might be a pension fund

#88

Post by digitaltrees »

jsmcgd wrote: post #62
adflux wrote: post #26

I really wish we'd get some innovation in the housing market. 3D printing of houses or something could be epic. "Just" disrupt the current construction companies... It's clear they can't keep up with the demand right now.

Lack of housing is not a technology or industrial problem. New homes can be made easily and relatively cheaply if given the go ahead. Lack of housing is by policy. By ensuring there are not enough houses ensures there is more demand than supply, which means higher housing prices, which means higher mortgages. The mortgage market is based on rising house prices. The banking industry is based on the mortgage industry.…

Blackrock is not abandoning anything or massively shifting strategy they have always been a real estate focused investor and have a multi decade history of residential single family investment. This is not evidence of coming inflation.

Re: If you sell a house these days, the buyer might be a pension fund

#89

Post by commandlinefan »

Cicero22 wrote: post #60
commandlinefan wrote: post #4

This hurts people who already own houses, too - property taxes are assessed on the appraised value of the home, which is a function of what the similarly-sized houses in your area sold for most recently. My property taxes have increased 10% every year for the past several years (and it would have been more if not for a legislative 10% annual cap). I worry that there will come a day when I've paid off my mortgage but…

It's a good thing that the value of your house is going up though, right? I suppose it might be upsetting to have to sell your house if it becomes too expensive, but that's a really nice problem to have imo.

> have to sell your house

Not particularly, if every other house is too expensive for a normal person to afford.

Re: If you sell a house these days, the buyer might be a pension fund

#90

Post by xapata »

> Home equity is the main financial element that middle class families use to build wealth, and black rock, a federal reserve funded financial institution is buying up all the houses to make sure that young families can’t build wealth.

Faulty logic. First, though historically people have used home equity to build wealth, that hasn't been the best method of building wealth. Most of those people would have been better off continuing to rent and investing in the stock market instead.

Second, building wealth through alternatives to home ownership may be better for a large portion of the population that finds the very fact of their residence decreases the value of a home relative to other homes.

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