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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

#821
post #539

Earlier quoted context omitted.

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 i…

I live in Massachusetts. Maybe I’d like to move to Palo Alto or Malibu. I hear they’re lovely.

To what extent, and by what mechanism, should the government of those two areas weight my preferences on housing policies in those areas? (I think it is properly exactly zero, even I say really, really want to.)

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

#822

Earlier quoted context omitted.

I'm not sure if this is what you mean by secret society, but I could well imagine that these kind of limits would be hard to enforce. Like a person creates shell corporations to own their properties on their behalf, or buys them in the name of their kids, or employs randos to "own" pieces of their portfolio.

They already do these things to take advantage of "primary residence" or "first-time home buyer" incentives; see the big hullabaloo over Letitia James doing it by accident.

I feel like a lot of politicians get exposed making these “accidents” that just fortunately happen to be beneficial to them.

Perhaps they ought to be more careful when filling out paperwork. Or perhaps they’re not accidents.

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

#823

Earlier quoted context omitted.

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…

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IMO, government owned basic dormitories with high density should exist. Think of something one or two steps above emergency shelters. Call them pods if you like.

Rent and utilities could be positioned at a level that permitted people to survive and have a foundation from which to lift themselves back up and perhaps eventually to a private housing situation with some luxury.

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

#825

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…

Based on the data I've seen, respectfully, you are wrong. No, I can't share it. The data is publicly available, however. Feel free to dig it up and aggregate it. The data is publicly available, the effort to dig into it, finding meaning, and sell it to folks, however, is not.

What I don't understand is how this new type of asset is above reproach.

I mean BlackRock and Blackstone creating securities backed by real estate in general, not only single family homes.

What if this new type of asset signals to the broader real estate market that regulators favor large investors?

Even more likely, what if this new type of asset succeeds at the expense of first time home buyers?

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

#826

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.

> Controversial, but for affordability reasons, there even should be a cap on how many homes an individual can own for rentals. Here in Norway the solution, as with so many other things, is taxing. Your home is evaluated at some "market rate", but if it's your primary residence the effective tax value is just 25% up to $1 million (70% on value above $1 million). For reference, a typical 3-room apartment in Oslo, the…

So you created a policy that takes money from the lower/working classes and those on welfare (restricting rental supply for those who rent) and transfers it as a tax subsidy to the middle class (who own) and are offering this up as "good" policy?

You've also encouraged your middle class to massively over-leverage themselves to a single house/apartment by creating a huge tax subsidy for them (from 30-75%), which will no doubt continue placing upward pressure on house prices and also create risks if interest rates increase. Why would you not take the biggest loan the bank will offer, given interest rates are quite low in Europe and you will not be taxed on most of the value of that property you can acquire with leverage?

Crazy thought, did your politicians ever think about the idea of NOT subsidizing the demand side at all? If the issue is the price of housing, subsidizing demand for it in any way is going to make that problem worse!

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

#827
post #783

Earlier quoted context omitted.

> Gold, cocoa, mustard seed, electricity I can easily live a full and meaningful life without owning gold, drinking cocoa or eating mustard. Those aren't essential and have decent substitutes. Electricity is essential, just like housing and it's very highly regulated.

That's overly reductive. I was hoping that the specific commodities weren't going to be the focus, but I guess that was naive. If you're going to use "housing" as an umbrella for its substitutes, let me do the same. Instead of wheat, beef, pork, cocoa, sugar, etc, let's call that "food". So now food is as essential as housing. Why doesn't the housing complaint against speculators work for food speculators?

The argument is either intellectually dishonest or you just really haven't thought this through very deep and are just puppeting this neoliberal bullshit.

We could start with I have traded wheat futures and could hedge with future contracts on all those commodities. You can't trade single family home derivatives in the same way because it is not the same.

This is unthinking market religion stupidity and the result is going to be a massive over correction towards socialism. You don't help free markets with this bullshit. You are helping to destroy them in the long run.

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

#828

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…

https://econofact.org/factbrief/do-private-equity-firms-own-...

> "Large institutional investors, defined as those owning over 100 homes (which includes private equity firms), own 3 percent of the single-family rental stock nationwide according to Brookings. This share is higher in some local markets — in the 20 Metropolitan Statistical Areas where these investors are most present, they own 12.4 percent"

I personally believe that its problematic that large institutional investors own 12.4% of single family properties in the 20 main metro areas of the US.

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

#829

Earlier quoted context omitted.

>Most jobs do not consistent entirely of literally rent-seeking. First off you're using "rent seeking" wrong, it's a specific economic term that means something else. But using your definition.... There's entire industries built around renting capital investments. Sometimes purely, like rental equipment. Sometimes the investmentents are so expensive they come with the labor to operate them (the way many buildings hav…

> First off you're using "rent seeking" wrong, it's a specific economic term that means something else. It is a specific term, but it means: taking control of a limited resource (e.g. housing), most typically by ownership, that you do not have any direct use for, and then seeking revenue by then renting it to other people who actually want to use it (e.g. live in it). Which, not suprisingly, is precisely what landlor…

>Which, not suprisingly, is precisely what landlords are doing.

The bulk of the political will for this garbage doesn't come from landlords. Landlords want more, more, more. There literally aren't enough landlords in this country for that.

It comes from existing homeowners who are not landlords and don't want a bunch of high(er than them) turnover housing near them let alone cheaper housing because of the "neighborhood character" or whatever. Basically got mine fuck you.

And this is enabled with the remainder of the political will being provided by a select number of unconscionably ignorant non property owners who have insane takes about how the government should manage all this, be deeply involved in this, immensely scrutinize any sort of property development, etc, etc, all of which is to the benefit of megacorp landlords and developers and the detriment of the small time guys who own a number of properties you can count on one hand with a sum total of units you can count on two or thereabouts who make up the overwhelming majority of landlords on a unit basis and if even a small percent of them added a little bit of capacity would be a huge amount.

> However, that does not apply to rental equipment, for example (though there are a few specific exceptions in the case of extremely expensive, very complex and/or very large equipment).

They don't rent seek the literal equipment. They rent seek your ability to use it without a bunch of thugs showing up with a "stop or else" proposition. You can literally buy a car crusher on Alibaba but you can't open a junkyard in my state without a permit that they have a well known hospital-esque "we only allow X to exist overall" system for, assuming your town doesn't outlaw the business outright.

Once again, this is all to the benefit of big business for whom a few million bucks of donations to the right stuff and work directed at the right firms as needed to get a variance (i.e. pay the law away) for their billion dollar dildo manufacturing plant or whatever whereas the guy who wants to, IDK, take his HVAC bending business to the next level, open a second site and get into process equipment is shit outta luck because without greasing palms he can't afford to the government will hem and haw about every goddamn detail and prevent anything from happening. And the existing industrial plant that got in before the rules is laughing its way to the bank the whole time, well, right up until it gets regulated all the way to China but that's a different problem.

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

#830

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…

You're right. It doesn't matter though. People love 'big fixes', the reality of systemic change is hard to present in a 2 minute sound bite or Instagram reel. This is the kind of 'fix' that gets implemented, then when things don't magically improve people will just give up.
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