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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

#801

Post by JumpCrisscross »

kelnos wrote: post #705
JumpCrisscross wrote: post #632

Earlier quoted context omitted.

> we decided to tax labor instead of land I live in Wyoming. We don't tax labor. Just extraction, consumption (sales), some investments and property. Our property is still expensive. > If homeowners were faced with the economic reality of their choices then markets would fix land use by themselves The problem begins and ends with supply restrictions.

More than 70% of the US population lives in a state with state income tax. So I think it's fair to say that "we" tax labor, in general, even if it's not universal. And regardless, "we" also means the US federal government here, and everyone in the US is subject to US income tax, regardless of which state you live in.

> it's fair to say that "we" tax labor, in general, even if it's not universal

The point is we have a natural difference-in-differences layout, and it doesn’t sustain the hypothesis that taxing labor is the problem (for this effect).

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

#802

Post by snow_mac »

This is a good thing, the next step however is to block the guys that use sites like BiggerPockets.com from buying up more then 5 single family homes. I know a whole bunch of guys who own 10 or more houses. That is excessive. We need to limit all investment of single family housing. Apartment complexes? Be my guest buy all you want, build all you want. But lets keep our neighborhoods full of people who can actually live in them.

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

#803

Post by [deleted] »

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…

[deleted]

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

#804

Post by fooker »

mmooss wrote: post #758
JoshTriplett wrote: post #23

One additional important detail: if this gets implemented at all, hopefully it does not affect the common practice of having a self-owned LLC owning your home. This is common for the purposes of keeping your personal name out of public records; it is far too easy to link someone's name and address, and people at risk of doxing can do this to protect themselves.

> common practice of having a self-owned LLC owning your home. This is common for the purposes of keeping your personal name out of public records I have a hard time believing lots of people care to do that - not many take steps for privacy - or have the resources or time to setup an LLC.

> or have the resources or time to setup an LLC.

Costs about 200$ at most places and can be done online.

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

#805

Post by erkt »

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 would be very against individual investors not being allowed to buy property for investment. I think most people can agree that corporations like blackstone/rock shouldn't be manipulating markets. It would be very bad to force blackrock to liquidate its current holdings of 230k homes. It could crater the entire industry and it runs into ex-post-facto issues. Assets need to maintain value or banks will fail.

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

#806

Post by fooker »

IncreasePosts wrote: post #189
JoshTriplett wrote: post #23

One additional important detail: if this gets implemented at all, hopefully it does not affect the common practice of having a self-owned LLC owning your home. This is common for the purposes of keeping your personal name out of public records; it is far too easy to link someone's name and address, and people at risk of doxing can do this to protect themselves.

Why should you be allowed to create a corporation that has no actual purpose other than a shield for your own private concerns?

You should be allowed to do whatever you want, by default. Preventing things only make sense if there's good reason to.

Otherwise everything you do, you have to first think about whether you are allowed to, like a slave.

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

#807

Post by Vegenoid »

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…

If so, then we can at least put that myth to rest and move closer to a real solution. The only potential downside I see here is that maybe it pushes the real solution a bit further down the road.

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

#808

Post by flave »

observationist wrote: post #357
WalterBright wrote: post #325

Earlier quoted context omitted.

> 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…

It's not just raising prices - it's holding prices steady at some point without the concurrent pressure to sell, for example, or manipulating other markets in order to raise or lower prices in an area, or using other mechanics to manipulate pricing, across the entire market, depending on the intended actions. If they intend to purchase properties, it benefits them to depress pricing in the area, if they intend to ren…

This just isn’t true - I sort of wish it where.

> If they intend to purchase properties, it benefits them to depress pricing in the area

Yeah, that’s true of everyone but how would a bank/individual do that? By selling… But if they sell while they’re depressing prices, they lose money!

> Normal landlords don't have effectively infinite money with no forces bearing prices down

Neither do banks. They have quarterly earnings, tax bills, they need to buy more stock, cost of capital etc etc.

> It's a very nuanced and complex system in which these institutional investors have very outsized influence.

Just saying ‘it’s complex’ is trivially true. But, supply and demand isn’t some small factor in that calculation - it’s an iron law that exerts itself at all times.

If a bank wants to ‘manipulate prices’ then, without a monopoly, the only way to do that is to dump or buy. But if you buy up homes to ‘push up prices’ … then you end up with a bunch of homes which you paid more than their current value. Not a great business.

The person who has the real unfair advantage in the US happens to also be the most sympathetic person - the owner occupier.

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

#810

Post by waffleiron »

nerdponx wrote: post #616
estearum wrote: post #370

Earlier quoted context omitted.

No, the real problem is that the vast majority of their income does not come from their role in creating supply or maintaining housing. Proof: Propose a 100% land value tax, which definitionally only removes that part of income that is generated by the community around their property, and see if they go for it.

The actual value of a landlord is insulating the tenant from financial risk, charging a predictable rent and absorbing the costs of repairs and maintenance. That's a lot of value for some people, but it also comes with problematic incentives and obvious bad outcomes when combined with other aspects of housing markets.

In a perfect world, but rent is often less significantly predictable than mortgage payments. Of course the cost of repairs and maintenance isn’t absorbed, it is paid in full by the renter in the cost of rent.
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