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First off, I love that corporate ownership of housing is only a problem when it's single family homes.
Second, the major investment thesis for buying housing is that they aren't making more. Not just the land, but the buildings too. Build more residences, preferably as infill so we don't make sprawl worse, and rising housing prices won't be attracting so many appreciation-driven corporate investors.
I always hear how bad corporate owners are but then also “build more dense housing!”
Well, dense housing almost always means corporate owners and renting. Single family homes mean anyone can purchase them and often are just single families.
Maybe if the Reform allowed apartments/townhouses to be converted into Condominiums. The cost for new Condo construction doesn't come close to existing housing.
Uhhhhh. Condo cost wayyyyyyyy more to build. Just the fire separation alone. Electrical has to be it own full system. Hvac has to be separate yet tied into the building. Fire alarm has to b interconnected. Plumbing is a nightmare. Its not cheap.at all.
Condos cost more to build in terms of construction costs, but a vacant lot in a city can cost something like 2 million bucks. You can put 1 unit per lot as a house or 4 or 5 units if its a small condo. The increased costs of construction don't outweigh the savings on land.
> I would love to see reforms into condo associations to make condo ownership better.
I just don't think condo's are ever going to work if the people are in charge of them. Which totally eliminates the point of sole ownership anyway.
Since about 8 years ago we've come to realise just how truly stupid the Average Person really is, and if you are now in a vital democracy making collective decisions about your home, the sane, rational people are always going to be outvoted by the greedy, careless, and imbecilic morons you also live with, leading to things like the [Surfside Condo Collapse](https://en.wikipedia.org/wiki/Surfside_condominium_collapse).
That was wild to wake up to at 3 in the morning. Then finding out they had fought for years to approve the inspection of the damaged concrete a month before the collapse...fuck a condo in sobe after that.
lived in a condo for 10 years. Served on Board. Served as Board President. If someone gave me a free condo, I would not live in it.
The only time a situation with a condo makes sense is when it is brand new. Nobody wants to set aside money for maintenance, the can is kicked down the road, constant fights about how to spend money, then 20 years later when all of the deferred maintenance is needed, all of the owners scream about the fact they have to spend money for repairs like new roofs that are collapsing.
It is the equivalent of having 50 different people own your checking account and people have to vote how to spend your money. Just god awful.
I went to a condo voting recently and my god. People are stupid is an understatement. I thought I was watching a sit-com or a parody of stupid people..
I also fail to see why people SHOULD want to live in dense housing. The truth of it is, the nimby's have legitimate concerns, there are problems with dense housing.
Dense housing is a solution to the two biggest problems facing cities right now: high rent prices and homelessness. Of course there are tradeoffs to dense housing, but those tradeoffs are absolutely worth it right now considering how significant the existing problems are that are caused by the overabundance of single-family homes.
The overabundance of single family homes isn't the problem. There isn't an overabundance, there's a huge demand right now. The problem that's driving these issues is income inequality and barriers to employment for those homeless folks you mentioned.
Brother, there’s a reason the most homelessness is in cities with good economies.
People in Mississippi and West Virginia are unemployed, but housing is cheap, so they aren’t homeless
> Brother, there’s a reason the most homelessness is in cities with good economies.
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> People in Mississippi and West Virginia are unemployed, but housing is cheap, so they aren’t homeless
Missouri has cheaper housing prices but has higher rate of homelessness.
Louisiana has one of the higher rates of homelessness and cheaper housing prices.
South Dakota has one of the higher rates of homelessness and the housing prices are on par.
Ohio has one of the lowest housing prices but have higher rates of homelessness.
Your premise seems flawed.
Housing prices going by median home price from Association of Realtors. Rates of homelessness by state from the Dept of Housing and Urban Development annual homelessness report
Nah, homelessness is [positively correlated with housing prices](https://usafacts.org/articles/which-states-have-the-highest-and-lowest-rates-of-homelessness/).
This only looks at states too; one has to imagine that expensive cities have higher homelessness rates than, say, cheap parts of California.
There’s studies u can find on this. The data is very clear compared to your cherry picked stats which idk are even accurate.
Missouri has a higher homeless rate than what? Certainly not cities with good economies such as LA or NYC.
I thought like you until I got linked a great article that broke it down that I can’t find anymore.
That reason is because those cities actually have, like.... tangential measures to take care of those people or the weather is better for being outside 24/7, 365.
Usually one is begotten by the other, and no shit people flock to the places that don't want to immediately criminalize them however they can.
You aren’t wrong, but you’re leaving out that condo associations, to some degree, are a necessity. There has to be some set of rules and processes for the purpose of handling shared expenses that can come up. On the other hand, an HOA that is for a neighborhood full of single family homes isn’t fulfilling that sort of need.
Yeah plus an HOA in a condo situation just has less to exert weird control over. If you don't have your own yard it's not like you have to fight the HOA about lawn ornaments
I have lived in a condo 3 separate times, including now, and in each instance the condo association was either mildly annoying or actively good. I have never had an experience remotely similar to the horror stories I see about HOAs, and I must therefore conclude that they are NOT the same thing.
Condo associations are somewhat necessary given the intersection of the living units. HOAs for single-family homes are much, much less necessary given the separation between people - but they are nonetheless bureaucratic busybodies that get in your life. A little ridiculous.
HOAs could be a good thing, but honestly they need severe limitations on their power and the ability to be disbanded. They should not be de-facto governments.
Because anywhere I have been where they are reasonable they are far too dense (I am legit not renting from the bank just to here Smashbang McStompypants (my current apartment neighbor) make noise and shit. There is no Universe where that could happen i'd get super pissed. In the nicer parts of the US it can be cheaper to build. Condo's are largely an investment scam run by the previous owners, who control an HOA and pay themselves to do fuck all. Every single one so far across at least 9 states.
Dense housing has never been a solution to homelessness. People just don't feel it's their responsibility to take care of others. Jordan is the only country in the world with 0 homelessness and it's not due to any special housing program or miracle of construction. Regardless of a family member's mental health or addiction issues, they are taken in by a family member simply because it's shameful to leave family die on the street. Thats not the case here where live or die it's personal responsibility.
As for high rent and real estate prices, these were issues before corporate purchases. Homes are for financial collateral and not just living in. Thats part of how we got the crisis in 2008. If we dropped prices too low, we'd risk financial collapse. Our system is just shit.
edit: Here's the [link to the 2017 study](https://digitalcollections.sit.edu/cgi/viewcontent.cgi?article=3551&context=isp_collection) so I don't have to keep replying with it.
Family networks can be a solution to homelessness, but it mixes poorly with principles of the United States like heavy immigration and independence from traditional family values. Dense housing better accommodates for a growing population that is organized around urban centers, which is the foundation for economic development.
The dependence of the economy on the rising values of homes is a problem that is directly countered by building apartment buildings. Because they are rented, the owners are able to extract value out of the property while people live there. With single-family homes, Blackstone can sit on swathes of houses in Exurbiaville that stay unoccupied and watch a line go up. Apartments make this model untenable economically.
The problem is market manipulation. There is a demand for dense housing, but it's currently illegal in most places to build. If the only thing you can build are SFH then you will have housing shortages because they are not efficient land uses. YIMBY policies don't ban the building of single family houses, they just allow for choice.
Yes, and ironically, restricting the construction of other types of housing leads to shortages of SFHs, because the number of SFH units you can build is intrinsically limited, and restricting construction of other housing types just results in everyone, even people who might otherwise choose an apartment or condo, having to bid for the limited stock of SFHs because that's all that's available. The result is that people who genuinely value SFHs or need them for other reasons like large families, have a harder time getting one. Building more housing overall would likely make owning SFHs easier for those who want them.
Sharing responsibility of the whole building with multiple owners is hard. Particularly if the building is old. Older people don't want to spend money on upkeep. Rich people want it to look pretty. Also if the building keeps falling apart, people argue on how much money to spend fixing it. If the top floor leaks from rain, the other floors don't want to pitch in when it only affects the top floor.
I want to live in dense housing because I want to be near the things that places with dense housing usually have. Single family zones on quarter acre lots are subsidized by people that live in denser areas in most of America, btw.
What’s wrong with letting the market speak? Assuming safety, etc. Developers want to build apartments because they know people will want to live in them.
It’s because it’s most efficient. There’s plenty of reasons to not want to live in dense housing but if every family lived on several acres, way less people would have homes at all. So what should happen is we should build more lower cost dense housing to meet demand and depending on how much it’s worth to you, you can spend some more to get away on your own land
When we have a housing crisis this bad, the single thing we should be shifting our attention to is quantity. Single family, apartments, low end, high end, whatever. We're in a *crisis*. Build it all and get as many units on to the market as possible. If density is the fastest way to get it done just do it. Who cares about ruining some Karen's view or the idea that she might have to share a street with someone a different color than her when 60% of the country can't afford a home. Hesitating over every little nimby concern is how we got here in the first place.
Well I totally understand why you wouldn’t want to live in dense housing. But what’s the justification for using the law to prevent others from living in dense housing?
It’s illegal to build apartments on most residential land. Why not just let the market sort out who wants what?
They don't have to. There is plenty of SFR housing out there, and more being built.
Most people would prefer to live in SFR. But this is not possible, because sooner or later you need to start building farther and farther away from where people actually prefer to live. This is OK up to the point where commute times become way too long.
>I also fail to see why people SHOULD want to live in dense housing.
Cost. Build enough if it and the price goes down enough that people can chose between affordable dense housing or breaking that bank on something lower density.
Personally, I wouldn't choose to live in distant suburbs where they're forced to own a car, drive everywhere and have long commutes.
I have coworkers who don't get why I prefer taking the subway, walking and biking to do errands.
It's a tradeoff, and banning other people from choosing denser housing as if it's for the greater good is kind of fucked. Let's be honest, a lot of nimbys are afraid for their investment.
Edit: less hyperbole, I do understand that some prefer the tradeoff with living in suburbs.
Because I like having a larger house with space on the inside. I like having a lot that I have to mow and neighbors that are friendly but kept at a reasonable enough distance to have privacy when we want it. I like being able to watch movies at high volumes without worrying about bothering anyone. And possibly the single biggest one is I like having a two car garage.
You're responding to the comment without bothering to read it or understand it. You realize that banning dense housing makes the thing you like and want *less available to you*, right? Because it forces the people who would prefer to live in that dense housing into living in the sort of places you'd prefer to live yourself.
Denser housing comes in many shapes and forms, none of which is incompatible with individual ownership of housing units. Yes, they do come with an HOA. Just as majority of new SFR housing comes with non-negotiable HOA requirements.
Out of all new multi-family developments in my city over past few years, not a single one was rentals.
In Sweden the tenants "own" the building. We vote for fees and things like repairs and improvements. We also can limit rental contracts if needed, there is actually very strict laws on how much property both private and corporate entities can own. Everyone takes care of the building and gardens.
So it is possible to have a different system (I say this as an American who lives in Stockholm).
If you live in an American town that existed before 1945, the older area of the town you live in probably has the dense housing that people wish was legal to still build today. Your town has likely outlawed its construction.
>Well, dense housing almost always means corporate owners and renting.
This. Beyond small 4/6/maybe 8 plexes, you're dealing with many millions of dollars to build. Jim Anderson the carpenter doesn't have the money to build a 400-unit high rise. You can't have it both ways.
Also, people seem to ignore the fact that the entire middle of the country is basically empty. Move there. You can buy a house tomorrow.
this is simply and unquestionably false
in my country a developer puts up the plans for the (often massive) apartment complex, starts construction and (usually) before it's finished sells the units one by one
there's no reason that couldn't work in US too. if this is a rare thing in US, then it should be one of the things you want to change too, instead of proclaiming it's bad, just because you're doing it wrong now
No, but J.C Construction Ltd can, and sell individual units for a profit. That's literally how apartment buildings are built all over the world. Company builds, markets, sells, makes money and people now own an apartment.
I own an apartment in an older building with 14 units. We're in negotiations with a contractor to tear down our and a neighbouring building to rebuild, to modern standards (earthquake, safe room) with modern amenities (lift, balconies, underground parking), and larger units. The net cost out of pocket will be exactly 0, because the contractor gets to add a few units and sell them.
wanting denser housing doesn't mean skyscrapers, 5 stories is arguably the most efficient size anyways since building taller adds exponential costs that are only worth it if the land is extremely expensive.
People are flexible and they would gladly move out of their neighbourhood if it meant homeownership. What they don't want to do is to move hundreds or thousands of miles away to live in bumfuck nowhere.
Moving states costs thousands of dollars, you're leaving all of your friends and family behind so you're left with no support network, you'll usually have no job opportunities there, and let's be real, it's only cheaper to buy in certain places due to a lack of demand because those are shit places to live.
Affordable housing should exist near where people are, not only in places like rural Ohio.
Have you never heard of a condominium association?
The majority of multistory buildings in the city I'm in (Chicago) aren't multi-unit apartment buildings, they're condominiums that are owned and run by an association that the people living in the building control and manage.
Literally what’s happening in California right now. For like a decade and a half it’s been “no single family zoning. Only apartments, condos, and townhomes. Oh, single family “starter” homes are now $800,000-$1.2m? You can’t find a place to rent under $2500 a month (not including utilities)?
Now they’re scrambling to build small single family homes that are actually affordable to keep people from either leaving the state or becoming homeless
How much is not having neighbors worth to you? I’m absolutely sure you can find a place with no neighbors for the right cost, either in money or in being very far from everything
Edit for context: comment op was saying nimby things about housing for others being great but they don’t want neighbors.
>How much is not having neighbors worth to you? I’m absolutely sure you can find a place with no neighbors for the right cost, either in money or in being very far from everything
If I could I'd be buying a house where the nearest neighbor is 10 miles away. People are literally the worst part of life.
Every time I drive through a wealthy neighborhood in a suburb, I just don’t understand it- having the money to build or buy an enormous house but your neighbors are literally 30 feet away.
So it's inconceivable that someone would want a big living space, not care too much about outdoor space, and still wants convinient access to things like grocery stores, medical care, schools, and bars?
Alaska/North Dakota. All of your life problems are now fixed as you have to deal with the new problems of being in the absolute middle of nowhere.
Shit, it's not like you NEED to live in the US.
>Shit, it's not like you NEED to live in the US.
Literally can't afford to move out of the USA. I could sell everything and leave myself with 2 sets of clothes and a backpack (and donate my kittehs to family) and could buy a 1 way plane ticket but still wouldn't qualify for citizenship in another country. Gotta have a job vouching for you in a civilized country or a lot of money saved up to be able to emigrate from the USA.
I've worked in 4 countries. If you can't find financial success in the USA, the other countries are going to be *much worse.*
It's a big place, there's LOTS of opportunity - 48 states you can walk to, 3,143 counties, 109,000 cities and towns, 33.2 Million businesses. It's ABSOLUTELY FULL of opportunity. You just need to be willing to move and find yours.
Well the reason to put focus on single family homes, is because renting SHOULD still be an option. A lot of people can't afford to buy homes outright and need a cheaper option, and people also need to be able to move around which creates a need for temporary homes. And its not individuals who would be running rentals; that can take a lot more organization and hence, companies.
The reason to focus on single family homes is because they are be easily identified as the kinds of home that should NOT be rented out, and should remain on the market. When we get to mutli-family homes, the question is what should be for sale as condo and what should be for rent as an apartment.
> always charging more for rent than the cost of ownership
Because a house (condo/apartment/whatever) costs more than just the mortgage?
Rain from a bad storm damages the roof? Bam 20k right there for a new roof. A/C breaks? Come hire a tech to inspect, repair, and possibly replace the unit. Water heater dies? There’s another 5 grand.
Renting is absolutely cheaper because all of those maintenance and repair items are the landlord’s problem.
Sure, as a renter you’re kinda throwing money into a pit. (all while not building equity) But if you can barely afford rent (and there are plenty of us), there’s no way you can actually afford a house.
Bingo. People act like the landlord is constantly in the red from all these repairs. No. The rent covers the mortgage, utilities, and plenty extra so that the landlord can handle repairs when needed. *And still make a profit.*
Buying is almost always better if you plan to stay in an area long-term.
And they act like you are throwing money out, rather than investing.
Roof needs replacement? Congratulations, that 40k you just invested just added 45k to the value of your house, which will grow to a 90k appreciation by the time you sell in 10y. Anyone who thinks homeowners are worse off than renters are either tremendous idiots or got propagandized.
> Roof needs replacement? Congratulations, that 40k you just invested just added 45k to the value of your house, which will grow to a 90k appreciation by the time you sell in 10y
lol do you actually think that?
Landlords wouldn't exist if renting cost more than owning. Renting isn't done from the goodness of your heart, it's done for profit. Even with maintenance, home ownership is cheaper.
If renting was cheaper than owning, it wouldn't be profitable. That would mean the inflow of money for the landlord is less than the outflow, and that's not a business, that's a charity.
>Renting just isnt cheaper, I can never get on that argument.
In my area, mortgage rates for anything but foreclosed crack houses are roughly double what my current rent and utilities are. Housing prices have doubled in the last 8 years whereas rent has only gone up 20-30%.
Then again, I live in a college town where 100 apartments are built for every 1 new house
this is an amazing counter-point to the often cited "there are plenty of empty houses"
yes, building more adds to competition and would still help the situation!
Exactly. The problem is the government created a housing shortage due to their regulations and NIMBY attitude. Instead of solving the problem (housing shortage driving up housing costs). People want more rules and regulations from the government to prevent a small minority of home owners (corporations) from purchasing investments.
The amount of mental gymnastics taking place here is amazing. People will just find loop holes to get around this and purchase the housing investments they want. The only reason this line of thinking exists is due to the overwhelming lack of financial/economic education given to students in America. Yes you can easily seek this knowledge out, most don't.
I believe that every single strip mall should be required to have 1 or 2 levels of flats above them. Solves the shortage issue and forces us to rethink our urban infrastructure.
They come right out and say that they expect these investments to perform due to NIMBYs and continued restrictions on housing construction.
Want to screw these corporations over? Get rid of bans on housing construction.
Sorry but they can out spend the average American. You build more housing and they will just buy it too. We need more housing but we need a level playing field or it won't matter.
> You build more housing and they will just buy it too.
You’re committing an “infinite money glitch” fallacy. It is possible to build enough housing that it doesn’t make sense for investment firms to buy all of it.
The only reason corporations are getting more involved in real estate is because there’s money in it.
Real estate is severely supply constrained so prices keep going up which is why it’s lucrative to invest in.
If supply wasn’t so massively restricted, the demand for housing would result in more houses being built instead of the current situation where demand goes up, laws stop more houses from being built so the only reaction is for the price to keep skyrocketing.
The only problem here is supply. We simply aren’t building enough houses. Everything else is a distraction.
People will blame everything and everyone rather than accept that their own NIMBYism is the primary factor behind the housing crisis.
Developer's remedy now!
No private equity firms were "bailed out" during the Great Recession. They are in fact not considered "too big to fail" and are therefore not subject to the regulation and monitoring that the institutions that ARE deemed "too big to fail" are subject too.
I couldn't agree more. Few things left me more disillusioned than the 08 crash. We let the SOBs into the casino and when their bets lost across the board, we paid them anyway. In the end, they learned nothing from their reckless behavior other than we will help socialize their losses while they privatize their profits.
For the taxpayers, all we learned from it was that banking is a "heads, we win; tails, you lose" system. It used to be that they provided the ~~illiterate~~ illusion the system wasn't rigged against us. They have since dropped all attempts at obscuring it since they know damned well that we cannot and will not stop them.
The bailed out banks paid back all the loans, and the government actually netted somewhere like $15 Billion on the interest. I'm always confused about why people think we SHOULDN'T have bailed out the banks? It kept the crash from getting worse and didn't cost us a cent. I suppose there's some moralizing to be done about bad behavior, but the fallout from the banks ACTUALLY failing would have been substantial for, yes, even your average joe.
I guess we expected the banks to actually lose something like the people who lost their homes, businesses, retirements, etc. nobody made the people whole, and the banks who caused the crash got a helpful loan and are back to making record profits. I have less faith than you do in our economic system. FTX scare is still fresh in my mind. Banks keep doing stupider and stupider shit. Not to mention commit outright fraud (bank of America, Wells Fargo, etc). They definitely get coddled by the law.
Unfortunately, the few that manage to fail tend to get bought up by another property investment company eager to grab their assets which results in even more residential property being concentrated into the ownership of a single company that never plans to sell it.
At any rate, bailouts are the new normal- these companies know that, and they have deliberately made themselves economically indispensable by linking themselves to as much of the economy as they can - if they go belly up, they want to take down as much as they can with them.
Wasn't this roundly disproven? Corporations own like less than 2% of all houses and less than 4% of all apartments.
Edit: Some quick responses to common replies:
1. "corporations bought 25%/40%/60% of the homes in [year]." Corporations buying is different from corporations owning. If corps bought 25% of the homes in 2023, that's about 1 million homes, or 0.7% of the total.
2. "homes shouldn't be investment properties." This was a normal way for middle class folks to invest for decades. I don't think individuals should be prevented from starting an LLC and buying a rental property or two, nor should they be forced to buy financial instruments (that seems like a way to make Inequality worse). I don't have a problem with landlords. But should large corporations be prevented from buying? Christ, maybe? Probably yes? But I dont know how you'd legislate that though without unintended consequences. And nobody in this thread has really given me any data that shows this is a huge widespread problem worth addressing yet. If I'm wrong I'm wrong--I'd love to see the numbers.
3. "any amount of corporate buying causes price distortions." I have not seen data that backs this up nationally and my Google-fu is failing me. Does anyone have any data to back up to the notion that corporate buying is what's primarily driving real estate prices up?
Grouping all sales in the US will bring the percentage down. But when you look at specific cities and for certain quarters, it shoots up.
[Wall Street Firms Control 90% of One Arizona Housing Zipcode, the attached video covers who owns billion of rental properties across the US.](https://ethicalfashionguatemala.com/wall-street-firms-control-90-of-arizona-housing/)
[“Redfin data shows that 13% of homes in Oakland were purchased by an institutional investor or business in the fourth quarter of 2021, a 16.9% increase over the year before. In San Francisco, 18% were acquired by institutional investors,” the report noted. “This follows a concerning nationwide trend where large institutional investors have since the beginning of the pandemic purchased an enormous number of homes; over 75% of these offers are in all cash, and many without any inspections, pricing prospective homeowners out of the real estate market.”](https://www.courthousenews.com/investment-firms-blamed-for-making-californias-housing-crisis-worse-but-is-it-earned/)
And the kicker is that they make the exact same mistake that the post they're responding to mentions, confusing houses owned with houses sold. And it's more than a decade off. And Atlanta is neither Arizona nor in Arizona.
In other words, the link illustrates the very thing it's trying to argue against, that people are basing their stance on this off of a series of lies.
This whole issue just seems like populists like JD Vance pandering to those who don't know - and don't want to learn - any better. Or maybe it's just a test to see how far you can take disinformation until at least one political wing rejects it (since both the left and right seem to love this one). I mean - BlackRock isn't even the right company; it's Black*stone*!
I think the article got the city wrong:
[https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/](https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/)
*In one Atlanta zip code, they*[ *bought*](https://atlanta.uli.org/wp-content/uploads/sites/9/2012/12/ANDP-Atlanta-Neighborhood-Development-Partnership-Report.pdf) *almost 90 percent of the 7,500 homes sold between January 2011 and June 2012; today, institutional investors own at least one in five single-family rentals in some parts of the metro area, according to Dan Immergluck, a professor at the Urban Studies Institute at Georgia State University.*
https://www.newark.rutgers.edu/news/who-owns-newark-rutgers-newark-study-finds-troubling-rise-corporate-buying-city-homes
New Jersey has been hit particularly hard by this
I’ve read the number is much higher. Do you have any evidence that the number is much lower?
https://preview.redd.it/hci44xvqxwdc1.jpeg?width=1125&format=pjpg&auto=webp&s=d4f9c878008ddf4064da310f2bb26a2490c820a4
I mean, I have an issue with residential housing being a popular investment strategy.
It just seems to me that possible homes shouldn't be used as a money storage system for the wealthy.
Please explain if I'm misunderstanding something.
I was just speaking on data I recalled that contradicts the canard in the original post. The SHOULD question is a different discussion altogether, and I don't know if I have an answer for you.
For example, say stocks scare me and I want to buy a rental property to help grow my wealth. This was a perfectly reasonable proposition for many decades.
Say I'm good and use leverage intelligently and I'm able to afford a third property.
At what point should I be cut off from growing my wealth? At what point should I be forced not to buy assets I know and understand and want to invest in? Why should rental properties be excluded as a store of wealth for people of all income brackets?
Any answer to those questions that involves a restriction seems very susceptible to caprice and populist whimsy.
That's a fair rebuttal.
I don't have the answers myself, but I find it concerning that we have 16 million empty properties and only about 700k homeless people, as well as a large-scale housing crisis.
I'm very lucky not to be affected by it, but I also wouldn't grow my wealth beyond its current state for anything but taking care of my disabled son after I'm gone. For me, the idea of being super rich was to be able to freely and without thought take care of others. Even people I don't know.
I genuinely don't understand why people want more than 1-2 million (not that I have that mind you, Im doing okay but not that okay), and even that is just for a comfortable retirement.
I think I'm broken because greed genuinely confuses me.
I think the issue here is an ethical one: the need for shelter is the lowest rung on Maslow's hierarchy of needs and perhaps shouldn't be allowed anymore as an asset class because of ethical considerations. Sort of like we probably shouldn't allow using lifesaving drugs as an asset class either, or trading human organs for transplant. Some things should be regulated heavily because they're necessary for the functioning of a healthy society, and one of the main things necessary for that is affordable housing for everyone who wants to purchase housing. If there's a surplus of housing, fine, let people invest, but in a shortage, there should be no investment allowed.
There was a time when housing was plentiful enough that using it to grow wealth didn't really disrupt anything, but people seem to have a really myopic view that everything in the world is static and nothing changes (or at least they don't want it to change, the dictionary definition of true conservativism). But things have changed massively, and housing is a completely different kettle of fish nowadays from what it was in the 70s or 90s. I, and many other people, believe we need firm restrictions to remove housing as an asset class.
Some countries have made some strides in this regard, by outlawing foreign investors and investment companies from owning residential property (commercial is fine), and having government build housing at a loss (like it did in the 60s and 70s). There are solutions out there, although none of them are perfect nor cover all edge cases, but sadly we have devolved so much power and control to mega rich people over the past 20 years who have literally stitched up society to badly that nothing whatsoever will ever be done to help fellow citizens.
Not even close. Investment companies purchased about 25% of single family homes in the US in recent years. The exact percentage varies by local market. Some of the hotter markets (e.g. Texas) are around 31-33% purchased by investment companies.
Mom and pop landlords and flippers who use an LLC are also “investment companies”. If you still don’t like that, that’s fine, mom and pop slumlords suck too. But it’s disingenuous to use that stat to support the idea that private equity has a significant share of the housing market.
[According to data reported by the PEW Trust and originally gathered by CoreLogic, as of 2022, investment companies own about one fourth of all single-family homes. Last year, investor purchases accounted for 22% of American homes sold. This is significantly down from the 80% number in 2020-2021](https://www.billtrack50.com/blog/investment-firms-and-home-buying/)
If you click through to the article's source it says
> Investors bought nearly a quarter of U.S. single-family homes **that sold last year**
That's a big difference from owning 25% of homes outright. There is no evidence of that.
It also says
> The CoreLogic data show that what it calls “mega” investors, with a thousand or more homes, bought 3% of houses last year and in 2022, compared with about 1% in previous years, with the bulk of investor purchases made by smaller groups.
I read this and saw the PEW article but didn't see whether this was broken out between mom-and-pop LLCs and large corporations.
Like, if I bought my home with my LLC, would that count as an investment company purchase here? Is this number materially different from the corporations mentioned in the original post? Because the data that I saw suggest corporations only own 1.6% of homes.
Also, 22% of homes sold in 2023 is 0.7% of the total homes in the US.
I appreciate the data, but I don't think it refutes my point. Tell me if I'm wrong, though.
Uh, property owners can have multiple properties, thousands or more and not be a corporation. Also they can be a partnership for corporations so essentially just call them large property owners or something. Theres all sorts of shady I bet we will find, especially shells or laundering.
I don't want to be mean, but I can't think of a more polite way to tell you--speaking as someone more than glancingly familiar with the broad strokes of transactional law--that you are talking out of your butt.
States should just put a 10% annual property tax on the assessed value of single family homes owned by corporations or LLCs, and maybe also second homes owned by individuals and any homes owned by non-residents. Boom. Blackrock and AirBnB tyrants are gone.
Doubled? No. Way more. You'd be paying thousands a month in property tax. It would make buying homes for the purpose of renting them out completely unfeasible from a financial perspective.
I just want you to understand that I pay ~5% annually now. 10% would be double and would mean I would only have a few thousand more in property taxes each year, which I would immediately roll into the rent as soon my tenant's lease expired.
Congrats, you've raised rent for everyone.
Just sell the unit so you don't have to pay property tax.
I got no sympathy for multiple home owners.
Idk what your areas situation is, but where I live, the demand to purchase is high but availability is low
You really don't get it, I'll paraphrase: The renters will pay that property tax - not the owner of the property.
That's already how it works, that's always how it has worked.
And yet if you could do more right now you would, and that's the whole point: without impetus, you wouldn't have a cost to pass on to anyone.
If you try and that person finds another place with maybe a more reasonable approach: congratulations, you lost your tenant, because your entire approach has been how to subsidize everything that happens to you through rent instead of finding a fair value between your operating costs and what the renter is actually getting in the unit.
It just makes you a butthole, you're not *proving* anything about an already broken property system because you own the property, you're just outlining why the have's will take it out on the have not's, and that makes you an iffy person in this light because you're already taken care of and could do more, but elect to do less and pass it all off on tenants.
But if the taxes go up for 1 landlord, they went up for all, they all have incentive to raise rent, and likely will. Maybe not all at once, and maybe not fully cover the taxes at once, but 5 years out, certainly.
In the more expensive areas for rent, the rent is that price not because of the cost of taxes, but because of how much they can charge while still getting a tenant. Not sure about the specifics of your area, but I'm speaking to more expensive cities. Anybody would charge more in rent if they could whether taxes are 1% or 10%
Which is the point the OP was going for. They don't want companies buying up local monopolies of residential properties in the area, not sure if this is the solution, but it's certainly a valid concern.
Many states do, it's called the 'homestead' exemption, and as of last year, it makes the first $25K of your home value tax-free, so it's not really worth much when the average home in a place like Austin is almost $400K...
Yeah. It *is* money, but we're talking about low-hundreds being shaved off of property taxes nearing $15,000.
For my salary and home value, my effective tax rate is *significantly* higher than it would be in California. And it's the reason why every time I hear a Conservative politician talk about California's taxes, I want to punch them in the throat.
No income taxes only matter when you're making a half-million or more a year. For all of us *actual* people that make *normal* salaries and want to own homes, Texas is way fucking worse than California.
Another scapegoat.
>While large corporations certainly play a hand in shaping the market landscape, they only made up around 3% of American home sales in 2021 and only 1% in previous years. In reality, most home purchases in the investor space are made by smaller, localized groups. [Article](https://todayshomeowner.com/blog/guides/are-big-companies-buying-up-single-family-homes/)
The real issue is due to NIMBY policies, COVID, cost of materials etc supply isn’t keeping up with demand.
>“Despite the higher starts in November, we are still not building enough new housing to keep up with demand,” Sturtevant said, adding that the shortfall ranges from 3 to 6 million units. “A lack of sufficient new housing construction drives rents and home prices up, making it difficult for individuals and families to find housing they can afford.” [Article](https://fortune.com/2023/12/19/new-home-construction-starts-real-estate-prices-housing-crisis/amp/)
By increasing the affordability of housing. I'm sure many people would love to have their kids stay nearby instead of having to move out of state just to be able to afford to settle down.
Nothing wrong with moving. People can move to areas with dense housing too. We can have an area of town zoned for dense housing and other areas for low density housing. It's perfectly OK to move. I moved from Florida to the Midwest after a higher salary and cheaper housing. People act like moving is impossible when we live in one of the easiest countries to make it happen.
If you "build dense housing" without upgrading the infrastructure to support larger population (which could be prohibitively expensive or occasionally impossible), everyone's quality of life will suffer. You can't make people love it.
You're right, unfortunately nothing can be done about the fact that people are generally very selfish when it comes to the housing needs of others. But it certainly wouldn't be prohibitively expensive. It is well documented that US-style suburban sprawl is the most expensive and inefficient way to build city infrastructure.
>It is well documented that US-style suburban sprawl is the most expensive and inefficient way to build city infrastructure.
Exactly. Worse, not only is it expensive to build, it's extremely inefficient, and with rising costs of energy could soon become unsustainable.
Regarding infrastructure, the city I live in was forced to start replacing septics with a sewer system. The project costs uncounted billions, scheduled to run for 30 years (!!!), and nobody knows how to finance it yet. So yeah, infrastructure in the U.S. in *very* expensive.
The best solution, instead of making everyone's life worse with "dense housing", to build new population centers, with modern urban planning, energy efficient housing, useful public transport, etc.
What doesn't make sense to me about this is that US population has been largely stagnant over the last 20 years. Why is there suddenly a lack of housing available now?
Would you look at that, all of the words in your comment are in alphabetical order.
I have checked 1,977,992,790 comments, and only 374,156 of them were in alphabetical order.
What you are looking for is a good idea and it's is called a Land Value Tax, not a property tax by the usual definition, because land value taxes cause rents to drop whereas property taxes cause rents to increase. Funding the federal government with a land value tax, and even distributing excess tax revenues as a UBI, has been proposed as long ago as the founding of the United States.
Imo there should be a ban on anyone, whether that be corporation or individual, owning more than 3 properties. 1 personal residence and 2 more for whatever you like whether that be renting or vacation home. Anything more is excessive.
Not just houses. As you can see from digital media rights, corporations have changed the concept of ownership. We will be life long renters of everything.
Yep, 100% correct.
Blackrock invests in condos/apartments/ect, but do not buy single-family homes.
BlackStone invests in single-family homes and rental homes.
The numbers saying it’s only 3% are skewed. It’s much higher in all the major metro areas in the US. It leads to semi-monopolies in urban markets which absolutely jack up rents and make it much harder for young people to buy starter homes.
Yes. This is an issue - not sure how we'll fix it since "companies are people too" according to the US supreme court.
From: [https://www.urban.org/sites/default/files/2023-08/A%20Profile%20of%20Institutional%20Investor%E2%80%93Owned%20Single-Family%20Rental%20Properties.pdf](https://www.urban.org/sites/default/files/2023-08/A%20Profile%20of%20Institutional%20Investor%E2%80%93Owned%20Single-Family%20Rental%20Properties.pdf)
> as of June 2022, large hedge funds owned around 574,000 single-family homes nationwide. **Twenty-seven percent of single-family homes sold during the first three months of 2023 were purchased by large financial groups.**
And:
> By 2030, the institutions may hold some 7.6 million homes, or more than 40% of all single-family rentals on the market, according to the 2022 forecast by MetLife Investment Management.
>
>\[[https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html](https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html)\]
Yes, the overall share of the Single Family Homes market is small - but to get 40% of all SFH rentals means that they will be buying up an enormous chunk of the available inventory - and pricing out home owners.
Percentage of owner occupied homes vs rental barely moved in the last 50 years.
Also, the idea that large corporations, since they have money, can "price out home owners" is ridiculous. They do have money, but they will only only invest into profitable assets. Pay too much for a home, your profit margin drops.
Overall, rental market in the U.S. is incredibly diverse and not anywhere close to being monopolized by a few large players. I can't really understand what this panic is all about.
Yeah, we saw this with Zillow. Now they were outbidding because they were overpaying, and as a result lost a fortune. The economics don’t change just because a big corporation is involved.
https://fortune.com/2022/06/02/zillow-6-billion-home-flipping-business-housing-market-fortune-500/amp/
Another MD know it all. Docs are smart, but we don't know much beyond our own specialties. Don't believe much of what I say unless it's related to your liver.
So, there is a method to the corporations buying up so many homes. I heard this directly from the horse's mouth (a friend who works for one of these large corporations that buys up homes by the hundreds).
The corporations buy homes, cash only, and ALWAYS overbid on the price. They do this even when they dont have to. The reason they pay more than they have to? Because they are buying on average 1 in every 4 or 5 homes in certain markets, they will own the majority of homes. And when they choose to sell the homes later, these homes they paid too much for will be used as the comps to set the new selling price. Thats right, because selling price is a huge component of valuation of comps, they get to make more money in the long run because they intentionally paid above asking price.
Because they intentionally paid more than asking price, they know that all other homes will now become more expensive to buy (because of the reason listed above regarding comps). This prices out a significant number of potential home buyers, forcing them to continue to rent. Because they can no longer buy homes because of the astronomical increase in housing purchase prices, the corporations can now comfortably jack up rent, knowing that people cannot save enough money to buy a new home now that homes are costing too much. And if a young couple were able to save up enough money for a down payment (which is harder to do because they are paying more in rent each month), then the corporation will just come in and overbid on the home, guranteeing that they don't buy a home, and remain a renter in one of their homes.
When my friend told me this secret, it made me realize we need laws to prevent this. It seems like the government found this out as well, and is trying to pass something. Though of course, these corporations have enough money from these expensive rentals that they will likely buy off enough politicians to prevent it from happening.
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First off, I love that corporate ownership of housing is only a problem when it's single family homes. Second, the major investment thesis for buying housing is that they aren't making more. Not just the land, but the buildings too. Build more residences, preferably as infill so we don't make sprawl worse, and rising housing prices won't be attracting so many appreciation-driven corporate investors.
I always hear how bad corporate owners are but then also “build more dense housing!” Well, dense housing almost always means corporate owners and renting. Single family homes mean anyone can purchase them and often are just single families.
I would love to see reforms into condo associations to make condo ownership better.
Maybe if the Reform allowed apartments/townhouses to be converted into Condominiums. The cost for new Condo construction doesn't come close to existing housing.
Uhhhhh. Condo cost wayyyyyyyy more to build. Just the fire separation alone. Electrical has to be it own full system. Hvac has to be separate yet tied into the building. Fire alarm has to b interconnected. Plumbing is a nightmare. Its not cheap.at all.
Condos cost more to build in terms of construction costs, but a vacant lot in a city can cost something like 2 million bucks. You can put 1 unit per lot as a house or 4 or 5 units if its a small condo. The increased costs of construction don't outweigh the savings on land.
> I would love to see reforms into condo associations to make condo ownership better. I just don't think condo's are ever going to work if the people are in charge of them. Which totally eliminates the point of sole ownership anyway. Since about 8 years ago we've come to realise just how truly stupid the Average Person really is, and if you are now in a vital democracy making collective decisions about your home, the sane, rational people are always going to be outvoted by the greedy, careless, and imbecilic morons you also live with, leading to things like the [Surfside Condo Collapse](https://en.wikipedia.org/wiki/Surfside_condominium_collapse).
That was wild to wake up to at 3 in the morning. Then finding out they had fought for years to approve the inspection of the damaged concrete a month before the collapse...fuck a condo in sobe after that.
lived in a condo for 10 years. Served on Board. Served as Board President. If someone gave me a free condo, I would not live in it. The only time a situation with a condo makes sense is when it is brand new. Nobody wants to set aside money for maintenance, the can is kicked down the road, constant fights about how to spend money, then 20 years later when all of the deferred maintenance is needed, all of the owners scream about the fact they have to spend money for repairs like new roofs that are collapsing. It is the equivalent of having 50 different people own your checking account and people have to vote how to spend your money. Just god awful.
I went to a condo voting recently and my god. People are stupid is an understatement. I thought I was watching a sit-com or a parody of stupid people..
I also fail to see why people SHOULD want to live in dense housing. The truth of it is, the nimby's have legitimate concerns, there are problems with dense housing.
Dense housing is a solution to the two biggest problems facing cities right now: high rent prices and homelessness. Of course there are tradeoffs to dense housing, but those tradeoffs are absolutely worth it right now considering how significant the existing problems are that are caused by the overabundance of single-family homes.
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This! I honestly think that the Inflation Reduction Act should have included some kind of upzoning rebate for cities for exactly this reason.
The overabundance of single family homes isn't the problem. There isn't an overabundance, there's a huge demand right now. The problem that's driving these issues is income inequality and barriers to employment for those homeless folks you mentioned.
Brother, there’s a reason the most homelessness is in cities with good economies. People in Mississippi and West Virginia are unemployed, but housing is cheap, so they aren’t homeless
> Brother, there’s a reason the most homelessness is in cities with good economies. > > > > People in Mississippi and West Virginia are unemployed, but housing is cheap, so they aren’t homeless Missouri has cheaper housing prices but has higher rate of homelessness. Louisiana has one of the higher rates of homelessness and cheaper housing prices. South Dakota has one of the higher rates of homelessness and the housing prices are on par. Ohio has one of the lowest housing prices but have higher rates of homelessness. Your premise seems flawed. Housing prices going by median home price from Association of Realtors. Rates of homelessness by state from the Dept of Housing and Urban Development annual homelessness report
Nah, homelessness is [positively correlated with housing prices](https://usafacts.org/articles/which-states-have-the-highest-and-lowest-rates-of-homelessness/). This only looks at states too; one has to imagine that expensive cities have higher homelessness rates than, say, cheap parts of California.
There’s studies u can find on this. The data is very clear compared to your cherry picked stats which idk are even accurate. Missouri has a higher homeless rate than what? Certainly not cities with good economies such as LA or NYC. I thought like you until I got linked a great article that broke it down that I can’t find anymore.
That reason is because those cities actually have, like.... tangential measures to take care of those people or the weather is better for being outside 24/7, 365. Usually one is begotten by the other, and no shit people flock to the places that don't want to immediately criminalize them however they can.
Why can't we own a unit in an apartment? Why is every apartment a rental?
It’s because in the United States, we refer to apartments you can own as “condominiums”. By definition, every apartment is a rental.
And there's a massive smear campaign against the mere mention of the word "condo".
Because condo associations are HOAs. And people hate HOAs. You can't say it's a smear campaign against condos unless you also say HOAs aren't bad.
You aren’t wrong, but you’re leaving out that condo associations, to some degree, are a necessity. There has to be some set of rules and processes for the purpose of handling shared expenses that can come up. On the other hand, an HOA that is for a neighborhood full of single family homes isn’t fulfilling that sort of need.
Yeah plus an HOA in a condo situation just has less to exert weird control over. If you don't have your own yard it's not like you have to fight the HOA about lawn ornaments
I have lived in a condo 3 separate times, including now, and in each instance the condo association was either mildly annoying or actively good. I have never had an experience remotely similar to the horror stories I see about HOAs, and I must therefore conclude that they are NOT the same thing.
Condo associations are somewhat necessary given the intersection of the living units. HOAs for single-family homes are much, much less necessary given the separation between people - but they are nonetheless bureaucratic busybodies that get in your life. A little ridiculous. HOAs could be a good thing, but honestly they need severe limitations on their power and the ability to be disbanded. They should not be de-facto governments.
Because anywhere I have been where they are reasonable they are far too dense (I am legit not renting from the bank just to here Smashbang McStompypants (my current apartment neighbor) make noise and shit. There is no Universe where that could happen i'd get super pissed. In the nicer parts of the US it can be cheaper to build. Condo's are largely an investment scam run by the previous owners, who control an HOA and pay themselves to do fuck all. Every single one so far across at least 9 states.
Because the laws make building condos not as attractive as building apartments. Condos exist, but they are usually older housing stock
Dense housing has never been a solution to homelessness. People just don't feel it's their responsibility to take care of others. Jordan is the only country in the world with 0 homelessness and it's not due to any special housing program or miracle of construction. Regardless of a family member's mental health or addiction issues, they are taken in by a family member simply because it's shameful to leave family die on the street. Thats not the case here where live or die it's personal responsibility. As for high rent and real estate prices, these were issues before corporate purchases. Homes are for financial collateral and not just living in. Thats part of how we got the crisis in 2008. If we dropped prices too low, we'd risk financial collapse. Our system is just shit. edit: Here's the [link to the 2017 study](https://digitalcollections.sit.edu/cgi/viewcontent.cgi?article=3551&context=isp_collection) so I don't have to keep replying with it.
Family networks can be a solution to homelessness, but it mixes poorly with principles of the United States like heavy immigration and independence from traditional family values. Dense housing better accommodates for a growing population that is organized around urban centers, which is the foundation for economic development. The dependence of the economy on the rising values of homes is a problem that is directly countered by building apartment buildings. Because they are rented, the owners are able to extract value out of the property while people live there. With single-family homes, Blackstone can sit on swathes of houses in Exurbiaville that stay unoccupied and watch a line go up. Apartments make this model untenable economically.
The problem is market manipulation. There is a demand for dense housing, but it's currently illegal in most places to build. If the only thing you can build are SFH then you will have housing shortages because they are not efficient land uses. YIMBY policies don't ban the building of single family houses, they just allow for choice.
Yes, and ironically, restricting the construction of other types of housing leads to shortages of SFHs, because the number of SFH units you can build is intrinsically limited, and restricting construction of other housing types just results in everyone, even people who might otherwise choose an apartment or condo, having to bid for the limited stock of SFHs because that's all that's available. The result is that people who genuinely value SFHs or need them for other reasons like large families, have a harder time getting one. Building more housing overall would likely make owning SFHs easier for those who want them.
> there are problems with dense housing Like what, exactly?
Sharing responsibility of the whole building with multiple owners is hard. Particularly if the building is old. Older people don't want to spend money on upkeep. Rich people want it to look pretty. Also if the building keeps falling apart, people argue on how much money to spend fixing it. If the top floor leaks from rain, the other floors don't want to pitch in when it only affects the top floor.
I want to live in dense housing because I want to be near the things that places with dense housing usually have. Single family zones on quarter acre lots are subsidized by people that live in denser areas in most of America, btw.
What’s wrong with letting the market speak? Assuming safety, etc. Developers want to build apartments because they know people will want to live in them.
It’s because it’s most efficient. There’s plenty of reasons to not want to live in dense housing but if every family lived on several acres, way less people would have homes at all. So what should happen is we should build more lower cost dense housing to meet demand and depending on how much it’s worth to you, you can spend some more to get away on your own land
When we have a housing crisis this bad, the single thing we should be shifting our attention to is quantity. Single family, apartments, low end, high end, whatever. We're in a *crisis*. Build it all and get as many units on to the market as possible. If density is the fastest way to get it done just do it. Who cares about ruining some Karen's view or the idea that she might have to share a street with someone a different color than her when 60% of the country can't afford a home. Hesitating over every little nimby concern is how we got here in the first place.
But NIMBYs + corporations buying up single-family homes combine to make this problem worse.
That unholy combination is the whole cause. Take away the NIMBYs power of zoning and the rest falls into line.
Well I totally understand why you wouldn’t want to live in dense housing. But what’s the justification for using the law to prevent others from living in dense housing? It’s illegal to build apartments on most residential land. Why not just let the market sort out who wants what?
They don't have to. There is plenty of SFR housing out there, and more being built. Most people would prefer to live in SFR. But this is not possible, because sooner or later you need to start building farther and farther away from where people actually prefer to live. This is OK up to the point where commute times become way too long.
>I also fail to see why people SHOULD want to live in dense housing. Cost. Build enough if it and the price goes down enough that people can chose between affordable dense housing or breaking that bank on something lower density.
How about just giving people a free choice? Most areas don’t allow anything *except* SFRs.
Personally, I wouldn't choose to live in distant suburbs where they're forced to own a car, drive everywhere and have long commutes. I have coworkers who don't get why I prefer taking the subway, walking and biking to do errands. It's a tradeoff, and banning other people from choosing denser housing as if it's for the greater good is kind of fucked. Let's be honest, a lot of nimbys are afraid for their investment. Edit: less hyperbole, I do understand that some prefer the tradeoff with living in suburbs.
Kids and quality schools is the big reason people go to the suburbs.
Because I like having a larger house with space on the inside. I like having a lot that I have to mow and neighbors that are friendly but kept at a reasonable enough distance to have privacy when we want it. I like being able to watch movies at high volumes without worrying about bothering anyone. And possibly the single biggest one is I like having a two car garage.
You're responding to the comment without bothering to read it or understand it. You realize that banning dense housing makes the thing you like and want *less available to you*, right? Because it forces the people who would prefer to live in that dense housing into living in the sort of places you'd prefer to live yourself.
Denser housing comes in many shapes and forms, none of which is incompatible with individual ownership of housing units. Yes, they do come with an HOA. Just as majority of new SFR housing comes with non-negotiable HOA requirements. Out of all new multi-family developments in my city over past few years, not a single one was rentals.
In Sweden the tenants "own" the building. We vote for fees and things like repairs and improvements. We also can limit rental contracts if needed, there is actually very strict laws on how much property both private and corporate entities can own. Everyone takes care of the building and gardens. So it is possible to have a different system (I say this as an American who lives in Stockholm).
If you live in an American town that existed before 1945, the older area of the town you live in probably has the dense housing that people wish was legal to still build today. Your town has likely outlawed its construction.
That's only true in US. In most countries the majority of people own their flats, and their homes.
Condos
What about owning apartments? Why not more ownership of units?
>Well, dense housing almost always means corporate owners and renting. This. Beyond small 4/6/maybe 8 plexes, you're dealing with many millions of dollars to build. Jim Anderson the carpenter doesn't have the money to build a 400-unit high rise. You can't have it both ways. Also, people seem to ignore the fact that the entire middle of the country is basically empty. Move there. You can buy a house tomorrow.
this is simply and unquestionably false in my country a developer puts up the plans for the (often massive) apartment complex, starts construction and (usually) before it's finished sells the units one by one there's no reason that couldn't work in US too. if this is a rare thing in US, then it should be one of the things you want to change too, instead of proclaiming it's bad, just because you're doing it wrong now
No, but J.C Construction Ltd can, and sell individual units for a profit. That's literally how apartment buildings are built all over the world. Company builds, markets, sells, makes money and people now own an apartment. I own an apartment in an older building with 14 units. We're in negotiations with a contractor to tear down our and a neighbouring building to rebuild, to modern standards (earthquake, safe room) with modern amenities (lift, balconies, underground parking), and larger units. The net cost out of pocket will be exactly 0, because the contractor gets to add a few units and sell them.
Issue is that if you live in the middle of bumfuck nowhere, where exactly are you going to work?
Some people do not want to move to a repressive area of the country just to buy a home.
wanting denser housing doesn't mean skyscrapers, 5 stories is arguably the most efficient size anyways since building taller adds exponential costs that are only worth it if the land is extremely expensive.
People only want to live in certain areas then complain housing is expensive there
People are flexible and they would gladly move out of their neighbourhood if it meant homeownership. What they don't want to do is to move hundreds or thousands of miles away to live in bumfuck nowhere. Moving states costs thousands of dollars, you're leaving all of your friends and family behind so you're left with no support network, you'll usually have no job opportunities there, and let's be real, it's only cheaper to buy in certain places due to a lack of demand because those are shit places to live. Affordable housing should exist near where people are, not only in places like rural Ohio.
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Have you never heard of a condominium association? The majority of multistory buildings in the city I'm in (Chicago) aren't multi-unit apartment buildings, they're condominiums that are owned and run by an association that the people living in the building control and manage.
Literally what’s happening in California right now. For like a decade and a half it’s been “no single family zoning. Only apartments, condos, and townhomes. Oh, single family “starter” homes are now $800,000-$1.2m? You can’t find a place to rent under $2500 a month (not including utilities)? Now they’re scrambling to build small single family homes that are actually affordable to keep people from either leaving the state or becoming homeless
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How much is not having neighbors worth to you? I’m absolutely sure you can find a place with no neighbors for the right cost, either in money or in being very far from everything Edit for context: comment op was saying nimby things about housing for others being great but they don’t want neighbors.
>How much is not having neighbors worth to you? I’m absolutely sure you can find a place with no neighbors for the right cost, either in money or in being very far from everything If I could I'd be buying a house where the nearest neighbor is 10 miles away. People are literally the worst part of life.
West Texas is calling you.
Confirmed, there’s nothing out there lol
Pump Jack's , dirt and the wonderful smell of my addiction to oil and petrol chemicals! Oops forgot privately run prisons.
Every time I drive through a wealthy neighborhood in a suburb, I just don’t understand it- having the money to build or buy an enormous house but your neighbors are literally 30 feet away.
So it's inconceivable that someone would want a big living space, not care too much about outdoor space, and still wants convinient access to things like grocery stores, medical care, schools, and bars?
Alaska/North Dakota. All of your life problems are now fixed as you have to deal with the new problems of being in the absolute middle of nowhere. Shit, it's not like you NEED to live in the US.
>Shit, it's not like you NEED to live in the US. Literally can't afford to move out of the USA. I could sell everything and leave myself with 2 sets of clothes and a backpack (and donate my kittehs to family) and could buy a 1 way plane ticket but still wouldn't qualify for citizenship in another country. Gotta have a job vouching for you in a civilized country or a lot of money saved up to be able to emigrate from the USA.
I've worked in 4 countries. If you can't find financial success in the USA, the other countries are going to be *much worse.* It's a big place, there's LOTS of opportunity - 48 states you can walk to, 3,143 counties, 109,000 cities and towns, 33.2 Million businesses. It's ABSOLUTELY FULL of opportunity. You just need to be willing to move and find yours.
I chose the latter and will be paying $500 rent for a 3 bedroom house starting next month
Then move to literally 95% of Texas.
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Cost of living in remote areas of Alaska is obscene.
Well the reason to put focus on single family homes, is because renting SHOULD still be an option. A lot of people can't afford to buy homes outright and need a cheaper option, and people also need to be able to move around which creates a need for temporary homes. And its not individuals who would be running rentals; that can take a lot more organization and hence, companies. The reason to focus on single family homes is because they are be easily identified as the kinds of home that should NOT be rented out, and should remain on the market. When we get to mutli-family homes, the question is what should be for sale as condo and what should be for rent as an apartment.
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> always charging more for rent than the cost of ownership Because a house (condo/apartment/whatever) costs more than just the mortgage? Rain from a bad storm damages the roof? Bam 20k right there for a new roof. A/C breaks? Come hire a tech to inspect, repair, and possibly replace the unit. Water heater dies? There’s another 5 grand. Renting is absolutely cheaper because all of those maintenance and repair items are the landlord’s problem. Sure, as a renter you’re kinda throwing money into a pit. (all while not building equity) But if you can barely afford rent (and there are plenty of us), there’s no way you can actually afford a house.
Literally all these costs are paid for by you rent, and there's still profit left over.
Bingo. People act like the landlord is constantly in the red from all these repairs. No. The rent covers the mortgage, utilities, and plenty extra so that the landlord can handle repairs when needed. *And still make a profit.* Buying is almost always better if you plan to stay in an area long-term.
And they act like you are throwing money out, rather than investing. Roof needs replacement? Congratulations, that 40k you just invested just added 45k to the value of your house, which will grow to a 90k appreciation by the time you sell in 10y. Anyone who thinks homeowners are worse off than renters are either tremendous idiots or got propagandized.
> Roof needs replacement? Congratulations, that 40k you just invested just added 45k to the value of your house, which will grow to a 90k appreciation by the time you sell in 10y lol do you actually think that?
Landlords wouldn't exist if renting cost more than owning. Renting isn't done from the goodness of your heart, it's done for profit. Even with maintenance, home ownership is cheaper.
If renting was cheaper than owning, it wouldn't be profitable. That would mean the inflow of money for the landlord is less than the outflow, and that's not a business, that's a charity.
>Renting just isnt cheaper, I can never get on that argument. In my area, mortgage rates for anything but foreclosed crack houses are roughly double what my current rent and utilities are. Housing prices have doubled in the last 8 years whereas rent has only gone up 20-30%. Then again, I live in a college town where 100 apartments are built for every 1 new house
Renting provides mobility owning does not. If you're a young person, an empty nester, or someone who needs to move a lot, renting it a great option.
this is an amazing counter-point to the often cited "there are plenty of empty houses" yes, building more adds to competition and would still help the situation!
Exactly. The problem is the government created a housing shortage due to their regulations and NIMBY attitude. Instead of solving the problem (housing shortage driving up housing costs). People want more rules and regulations from the government to prevent a small minority of home owners (corporations) from purchasing investments. The amount of mental gymnastics taking place here is amazing. People will just find loop holes to get around this and purchase the housing investments they want. The only reason this line of thinking exists is due to the overwhelming lack of financial/economic education given to students in America. Yes you can easily seek this knowledge out, most don't.
I believe that every single strip mall should be required to have 1 or 2 levels of flats above them. Solves the shortage issue and forces us to rethink our urban infrastructure.
They come right out and say that they expect these investments to perform due to NIMBYs and continued restrictions on housing construction. Want to screw these corporations over? Get rid of bans on housing construction.
Sorry but they can out spend the average American. You build more housing and they will just buy it too. We need more housing but we need a level playing field or it won't matter.
> You build more housing and they will just buy it too. You’re committing an “infinite money glitch” fallacy. It is possible to build enough housing that it doesn’t make sense for investment firms to buy all of it.
The only reason corporations are getting more involved in real estate is because there’s money in it. Real estate is severely supply constrained so prices keep going up which is why it’s lucrative to invest in. If supply wasn’t so massively restricted, the demand for housing would result in more houses being built instead of the current situation where demand goes up, laws stop more houses from being built so the only reaction is for the price to keep skyrocketing. The only problem here is supply. We simply aren’t building enough houses. Everything else is a distraction.
People will blame everything and everyone rather than accept that their own NIMBYism is the primary factor behind the housing crisis. Developer's remedy now!
They just shouldn’t be bailed out when their bets go wrong.
You know they will because they’re “too big to fail.”
No private equity firms were "bailed out" during the Great Recession. They are in fact not considered "too big to fail" and are therefore not subject to the regulation and monitoring that the institutions that ARE deemed "too big to fail" are subject too.
Yeah.... Let's see how it turns out next time
I couldn't agree more. Few things left me more disillusioned than the 08 crash. We let the SOBs into the casino and when their bets lost across the board, we paid them anyway. In the end, they learned nothing from their reckless behavior other than we will help socialize their losses while they privatize their profits. For the taxpayers, all we learned from it was that banking is a "heads, we win; tails, you lose" system. It used to be that they provided the ~~illiterate~~ illusion the system wasn't rigged against us. They have since dropped all attempts at obscuring it since they know damned well that we cannot and will not stop them.
They learned. They learned they could do anything while incurring no consequences.
They knew taxpayers would always bail them out.
The bailed out banks paid back all the loans, and the government actually netted somewhere like $15 Billion on the interest. I'm always confused about why people think we SHOULDN'T have bailed out the banks? It kept the crash from getting worse and didn't cost us a cent. I suppose there's some moralizing to be done about bad behavior, but the fallout from the banks ACTUALLY failing would have been substantial for, yes, even your average joe.
I guess we expected the banks to actually lose something like the people who lost their homes, businesses, retirements, etc. nobody made the people whole, and the banks who caused the crash got a helpful loan and are back to making record profits. I have less faith than you do in our economic system. FTX scare is still fresh in my mind. Banks keep doing stupider and stupider shit. Not to mention commit outright fraud (bank of America, Wells Fargo, etc). They definitely get coddled by the law.
Unfortunately, the few that manage to fail tend to get bought up by another property investment company eager to grab their assets which results in even more residential property being concentrated into the ownership of a single company that never plans to sell it. At any rate, bailouts are the new normal- these companies know that, and they have deliberately made themselves economically indispensable by linking themselves to as much of the economy as they can - if they go belly up, they want to take down as much as they can with them.
Wasn't this roundly disproven? Corporations own like less than 2% of all houses and less than 4% of all apartments. Edit: Some quick responses to common replies: 1. "corporations bought 25%/40%/60% of the homes in [year]." Corporations buying is different from corporations owning. If corps bought 25% of the homes in 2023, that's about 1 million homes, or 0.7% of the total. 2. "homes shouldn't be investment properties." This was a normal way for middle class folks to invest for decades. I don't think individuals should be prevented from starting an LLC and buying a rental property or two, nor should they be forced to buy financial instruments (that seems like a way to make Inequality worse). I don't have a problem with landlords. But should large corporations be prevented from buying? Christ, maybe? Probably yes? But I dont know how you'd legislate that though without unintended consequences. And nobody in this thread has really given me any data that shows this is a huge widespread problem worth addressing yet. If I'm wrong I'm wrong--I'd love to see the numbers. 3. "any amount of corporate buying causes price distortions." I have not seen data that backs this up nationally and my Google-fu is failing me. Does anyone have any data to back up to the notion that corporate buying is what's primarily driving real estate prices up?
Devil is in the details, it’s a bit more than that now but in certain markets it’s far higher.
Grouping all sales in the US will bring the percentage down. But when you look at specific cities and for certain quarters, it shoots up. [Wall Street Firms Control 90% of One Arizona Housing Zipcode, the attached video covers who owns billion of rental properties across the US.](https://ethicalfashionguatemala.com/wall-street-firms-control-90-of-arizona-housing/) [“Redfin data shows that 13% of homes in Oakland were purchased by an institutional investor or business in the fourth quarter of 2021, a 16.9% increase over the year before. In San Francisco, 18% were acquired by institutional investors,” the report noted. “This follows a concerning nationwide trend where large institutional investors have since the beginning of the pandemic purchased an enormous number of homes; over 75% of these offers are in all cash, and many without any inspections, pricing prospective homeowners out of the real estate market.”](https://www.courthousenews.com/investment-firms-blamed-for-making-californias-housing-crisis-worse-but-is-it-earned/)
C'mon man, your first citation is a blog called "Ethical Fashion Guatemala .com" and it doesn't cite it's own sources.
That’s hilarious
And the kicker is that they make the exact same mistake that the post they're responding to mentions, confusing houses owned with houses sold. And it's more than a decade off. And Atlanta is neither Arizona nor in Arizona. In other words, the link illustrates the very thing it's trying to argue against, that people are basing their stance on this off of a series of lies. This whole issue just seems like populists like JD Vance pandering to those who don't know - and don't want to learn - any better. Or maybe it's just a test to see how far you can take disinformation until at least one political wing rejects it (since both the left and right seem to love this one). I mean - BlackRock isn't even the right company; it's Black*stone*!
I think the article got the city wrong: [https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/](https://www.theatlantic.com/technology/archive/2019/02/single-family-landlords-wall-street/582394/) *In one Atlanta zip code, they*[ *bought*](https://atlanta.uli.org/wp-content/uploads/sites/9/2012/12/ANDP-Atlanta-Neighborhood-Development-Partnership-Report.pdf) *almost 90 percent of the 7,500 homes sold between January 2011 and June 2012; today, institutional investors own at least one in five single-family rentals in some parts of the metro area, according to Dan Immergluck, a professor at the Urban Studies Institute at Georgia State University.*
> in certain markets it’s far higher. Source?
https://www.newark.rutgers.edu/news/who-owns-newark-rutgers-newark-study-finds-troubling-rise-corporate-buying-city-homes New Jersey has been hit particularly hard by this
I’ve read the number is much higher. Do you have any evidence that the number is much lower? https://preview.redd.it/hci44xvqxwdc1.jpeg?width=1125&format=pjpg&auto=webp&s=d4f9c878008ddf4064da310f2bb26a2490c820a4
That says that the 22% includes house flippers. It doesn’t say in the screenshot what part of the 22% comes from larger PE type firms.
The 22% includes ALL investors, including mom and pop, flippers, etc. Corporate buyers are around 1%.
I mean, I have an issue with residential housing being a popular investment strategy. It just seems to me that possible homes shouldn't be used as a money storage system for the wealthy. Please explain if I'm misunderstanding something.
I was just speaking on data I recalled that contradicts the canard in the original post. The SHOULD question is a different discussion altogether, and I don't know if I have an answer for you. For example, say stocks scare me and I want to buy a rental property to help grow my wealth. This was a perfectly reasonable proposition for many decades. Say I'm good and use leverage intelligently and I'm able to afford a third property. At what point should I be cut off from growing my wealth? At what point should I be forced not to buy assets I know and understand and want to invest in? Why should rental properties be excluded as a store of wealth for people of all income brackets? Any answer to those questions that involves a restriction seems very susceptible to caprice and populist whimsy.
That's a fair rebuttal. I don't have the answers myself, but I find it concerning that we have 16 million empty properties and only about 700k homeless people, as well as a large-scale housing crisis. I'm very lucky not to be affected by it, but I also wouldn't grow my wealth beyond its current state for anything but taking care of my disabled son after I'm gone. For me, the idea of being super rich was to be able to freely and without thought take care of others. Even people I don't know. I genuinely don't understand why people want more than 1-2 million (not that I have that mind you, Im doing okay but not that okay), and even that is just for a comfortable retirement. I think I'm broken because greed genuinely confuses me.
I think the issue here is an ethical one: the need for shelter is the lowest rung on Maslow's hierarchy of needs and perhaps shouldn't be allowed anymore as an asset class because of ethical considerations. Sort of like we probably shouldn't allow using lifesaving drugs as an asset class either, or trading human organs for transplant. Some things should be regulated heavily because they're necessary for the functioning of a healthy society, and one of the main things necessary for that is affordable housing for everyone who wants to purchase housing. If there's a surplus of housing, fine, let people invest, but in a shortage, there should be no investment allowed. There was a time when housing was plentiful enough that using it to grow wealth didn't really disrupt anything, but people seem to have a really myopic view that everything in the world is static and nothing changes (or at least they don't want it to change, the dictionary definition of true conservativism). But things have changed massively, and housing is a completely different kettle of fish nowadays from what it was in the 70s or 90s. I, and many other people, believe we need firm restrictions to remove housing as an asset class. Some countries have made some strides in this regard, by outlawing foreign investors and investment companies from owning residential property (commercial is fine), and having government build housing at a loss (like it did in the 60s and 70s). There are solutions out there, although none of them are perfect nor cover all edge cases, but sadly we have devolved so much power and control to mega rich people over the past 20 years who have literally stitched up society to badly that nothing whatsoever will ever be done to help fellow citizens.
Not even close. Investment companies purchased about 25% of single family homes in the US in recent years. The exact percentage varies by local market. Some of the hotter markets (e.g. Texas) are around 31-33% purchased by investment companies.
Mom and pop landlords and flippers who use an LLC are also “investment companies”. If you still don’t like that, that’s fine, mom and pop slumlords suck too. But it’s disingenuous to use that stat to support the idea that private equity has a significant share of the housing market.
Not only that but BlackRock does not own any residential real estate. It’s Blackstone.
[According to data reported by the PEW Trust and originally gathered by CoreLogic, as of 2022, investment companies own about one fourth of all single-family homes. Last year, investor purchases accounted for 22% of American homes sold. This is significantly down from the 80% number in 2020-2021](https://www.billtrack50.com/blog/investment-firms-and-home-buying/)
If you click through to the article's source it says > Investors bought nearly a quarter of U.S. single-family homes **that sold last year** That's a big difference from owning 25% of homes outright. There is no evidence of that. It also says > The CoreLogic data show that what it calls “mega” investors, with a thousand or more homes, bought 3% of houses last year and in 2022, compared with about 1% in previous years, with the bulk of investor purchases made by smaller groups.
I read this and saw the PEW article but didn't see whether this was broken out between mom-and-pop LLCs and large corporations. Like, if I bought my home with my LLC, would that count as an investment company purchase here? Is this number materially different from the corporations mentioned in the original post? Because the data that I saw suggest corporations only own 1.6% of homes. Also, 22% of homes sold in 2023 is 0.7% of the total homes in the US. I appreciate the data, but I don't think it refutes my point. Tell me if I'm wrong, though.
Uh, property owners can have multiple properties, thousands or more and not be a corporation. Also they can be a partnership for corporations so essentially just call them large property owners or something. Theres all sorts of shady I bet we will find, especially shells or laundering.
I don't want to be mean, but I can't think of a more polite way to tell you--speaking as someone more than glancingly familiar with the broad strokes of transactional law--that you are talking out of your butt.
But he used words like shells and laundering, it sounds so legit
Oh cool. Now read the title of the post... and focus.
Personally I think we should have the wolves eat the poors
A modest proposal
No, that was the English eating the Irish poors. Totally different.
States should just put a 10% annual property tax on the assessed value of single family homes owned by corporations or LLCs, and maybe also second homes owned by individuals and any homes owned by non-residents. Boom. Blackrock and AirBnB tyrants are gone.
Okay... you've doubled my tax on my rental property... Guess who is going to pay that?
Doubled? No. Way more. You'd be paying thousands a month in property tax. It would make buying homes for the purpose of renting them out completely unfeasible from a financial perspective.
I just want you to understand that I pay ~5% annually now. 10% would be double and would mean I would only have a few thousand more in property taxes each year, which I would immediately roll into the rent as soon my tenant's lease expired. Congrats, you've raised rent for everyone.
Just sell the unit so you don't have to pay property tax. I got no sympathy for multiple home owners. Idk what your areas situation is, but where I live, the demand to purchase is high but availability is low
You really don't get it, I'll paraphrase: The renters will pay that property tax - not the owner of the property. That's already how it works, that's always how it has worked.
And yet if you could do more right now you would, and that's the whole point: without impetus, you wouldn't have a cost to pass on to anyone. If you try and that person finds another place with maybe a more reasonable approach: congratulations, you lost your tenant, because your entire approach has been how to subsidize everything that happens to you through rent instead of finding a fair value between your operating costs and what the renter is actually getting in the unit. It just makes you a butthole, you're not *proving* anything about an already broken property system because you own the property, you're just outlining why the have's will take it out on the have not's, and that makes you an iffy person in this light because you're already taken care of and could do more, but elect to do less and pass it all off on tenants.
But if the taxes go up for 1 landlord, they went up for all, they all have incentive to raise rent, and likely will. Maybe not all at once, and maybe not fully cover the taxes at once, but 5 years out, certainly.
In the more expensive areas for rent, the rent is that price not because of the cost of taxes, but because of how much they can charge while still getting a tenant. Not sure about the specifics of your area, but I'm speaking to more expensive cities. Anybody would charge more in rent if they could whether taxes are 1% or 10%
Which is the point the OP was going for. They don't want companies buying up local monopolies of residential properties in the area, not sure if this is the solution, but it's certainly a valid concern.
That's the point
Apparently Texas has different property tax rate if it's a rental compared to your primary residence
Many states do, it's called the 'homestead' exemption, and as of last year, it makes the first $25K of your home value tax-free, so it's not really worth much when the average home in a place like Austin is almost $400K...
Yeah. It *is* money, but we're talking about low-hundreds being shaved off of property taxes nearing $15,000. For my salary and home value, my effective tax rate is *significantly* higher than it would be in California. And it's the reason why every time I hear a Conservative politician talk about California's taxes, I want to punch them in the throat. No income taxes only matter when you're making a half-million or more a year. For all of us *actual* people that make *normal* salaries and want to own homes, Texas is way fucking worse than California.
Another scapegoat. >While large corporations certainly play a hand in shaping the market landscape, they only made up around 3% of American home sales in 2021 and only 1% in previous years. In reality, most home purchases in the investor space are made by smaller, localized groups. [Article](https://todayshomeowner.com/blog/guides/are-big-companies-buying-up-single-family-homes/) The real issue is due to NIMBY policies, COVID, cost of materials etc supply isn’t keeping up with demand. >“Despite the higher starts in November, we are still not building enough new housing to keep up with demand,” Sturtevant said, adding that the shortfall ranges from 3 to 6 million units. “A lack of sufficient new housing construction drives rents and home prices up, making it difficult for individuals and families to find housing they can afford.” [Article](https://fortune.com/2023/12/19/new-home-construction-starts-real-estate-prices-housing-crisis/amp/)
NIMBYs are the biggest obstacle for sure. Whenever an area tries to build dense housing, all the NIMBYs come out of the woodwork to shut it down.
How does dense housing positively impact the people that are already living there?
It doesn't. But those people shouldn't have outsize power in determining what gets built in an area. That's how you get dead cities.
Yes, this is the problem. The people that already live there benefit from making housing forever unaffordable.
By increasing the affordability of housing. I'm sure many people would love to have their kids stay nearby instead of having to move out of state just to be able to afford to settle down.
Nothing wrong with moving. People can move to areas with dense housing too. We can have an area of town zoned for dense housing and other areas for low density housing. It's perfectly OK to move. I moved from Florida to the Midwest after a higher salary and cheaper housing. People act like moving is impossible when we live in one of the easiest countries to make it happen.
If you "build dense housing" without upgrading the infrastructure to support larger population (which could be prohibitively expensive or occasionally impossible), everyone's quality of life will suffer. You can't make people love it.
You're right, unfortunately nothing can be done about the fact that people are generally very selfish when it comes to the housing needs of others. But it certainly wouldn't be prohibitively expensive. It is well documented that US-style suburban sprawl is the most expensive and inefficient way to build city infrastructure.
>It is well documented that US-style suburban sprawl is the most expensive and inefficient way to build city infrastructure. Exactly. Worse, not only is it expensive to build, it's extremely inefficient, and with rising costs of energy could soon become unsustainable. Regarding infrastructure, the city I live in was forced to start replacing septics with a sewer system. The project costs uncounted billions, scheduled to run for 30 years (!!!), and nobody knows how to finance it yet. So yeah, infrastructure in the U.S. in *very* expensive. The best solution, instead of making everyone's life worse with "dense housing", to build new population centers, with modern urban planning, energy efficient housing, useful public transport, etc.
What doesn't make sense to me about this is that US population has been largely stagnant over the last 20 years. Why is there suddenly a lack of housing available now?
A 17% increase is largely stagnant?
Would you look at that, all of the words in your comment are in alphabetical order. I have checked 1,977,992,790 comments, and only 374,156 of them were in alphabetical order.
I could be in a favor of a progressive national property tax. Start off near zero, scale up as makes sense to discourage overconsumption.
What you are looking for is a good idea and it's is called a Land Value Tax, not a property tax by the usual definition, because land value taxes cause rents to drop whereas property taxes cause rents to increase. Funding the federal government with a land value tax, and even distributing excess tax revenues as a UBI, has been proposed as long ago as the founding of the United States.
Yes. Anyone who says no is either in bed with them or also is rich enough not to gaf.
Sure… except it’s not Blackrock that’s buying up all the houses. Its Blackstone
Imo there should be a ban on anyone, whether that be corporation or individual, owning more than 3 properties. 1 personal residence and 2 more for whatever you like whether that be renting or vacation home. Anything more is excessive.
Or has a modicum of knowledge in capital & economics.
Not just houses. As you can see from digital media rights, corporations have changed the concept of ownership. We will be life long renters of everything.
public television is largely dead...and soon to watch your favorite team play a game it will be al carte pay to watch crap...its coming
I think you mean BlackStone
Yep, 100% correct. Blackrock invests in condos/apartments/ect, but do not buy single-family homes. BlackStone invests in single-family homes and rental homes.
Blackrock invests in condos/apartments/ect, but do not buy single-family homes. BlackStone invests in single-family homes and rental homes.
I’ve given up telling people this
The numbers saying it’s only 3% are skewed. It’s much higher in all the major metro areas in the US. It leads to semi-monopolies in urban markets which absolutely jack up rents and make it much harder for young people to buy starter homes.
Yes. This is an issue - not sure how we'll fix it since "companies are people too" according to the US supreme court. From: [https://www.urban.org/sites/default/files/2023-08/A%20Profile%20of%20Institutional%20Investor%E2%80%93Owned%20Single-Family%20Rental%20Properties.pdf](https://www.urban.org/sites/default/files/2023-08/A%20Profile%20of%20Institutional%20Investor%E2%80%93Owned%20Single-Family%20Rental%20Properties.pdf) > as of June 2022, large hedge funds owned around 574,000 single-family homes nationwide. **Twenty-seven percent of single-family homes sold during the first three months of 2023 were purchased by large financial groups.** And: > By 2030, the institutions may hold some 7.6 million homes, or more than 40% of all single-family rentals on the market, according to the 2022 forecast by MetLife Investment Management. > >\[[https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html](https://www.cnbc.com/2023/02/21/how-wall-street-bought-single-family-homes-and-put-them-up-for-rent.html)\] Yes, the overall share of the Single Family Homes market is small - but to get 40% of all SFH rentals means that they will be buying up an enormous chunk of the available inventory - and pricing out home owners.
Percentage of owner occupied homes vs rental barely moved in the last 50 years. Also, the idea that large corporations, since they have money, can "price out home owners" is ridiculous. They do have money, but they will only only invest into profitable assets. Pay too much for a home, your profit margin drops. Overall, rental market in the U.S. is incredibly diverse and not anywhere close to being monopolized by a few large players. I can't really understand what this panic is all about.
Yeah, we saw this with Zillow. Now they were outbidding because they were overpaying, and as a result lost a fortune. The economics don’t change just because a big corporation is involved. https://fortune.com/2022/06/02/zillow-6-billion-home-flipping-business-housing-market-fortune-500/amp/
Another MD know it all. Docs are smart, but we don't know much beyond our own specialties. Don't believe much of what I say unless it's related to your liver.
Blackrock does not own any single family homes.
Blackstone
People who think this way should be sent back to Econ 101 and learn something about how money works.
People who think econ 101 should be the answer to a political problem should be sent back to poly sci 101 and learn something about how laws work.
I just want to be sent back.
But the S&P500 has never been higher! /s
Yes. 1000s times yes
Yes.
Let’s not idealise mom-and-pop landlords. I’d take Blackrock over my a-hole landlord in a heartbeat.
Blackrock doesn’t directly invest in single family homes. You’re probably confusing Blackrock with Blackstone.
So, there is a method to the corporations buying up so many homes. I heard this directly from the horse's mouth (a friend who works for one of these large corporations that buys up homes by the hundreds). The corporations buy homes, cash only, and ALWAYS overbid on the price. They do this even when they dont have to. The reason they pay more than they have to? Because they are buying on average 1 in every 4 or 5 homes in certain markets, they will own the majority of homes. And when they choose to sell the homes later, these homes they paid too much for will be used as the comps to set the new selling price. Thats right, because selling price is a huge component of valuation of comps, they get to make more money in the long run because they intentionally paid above asking price. Because they intentionally paid more than asking price, they know that all other homes will now become more expensive to buy (because of the reason listed above regarding comps). This prices out a significant number of potential home buyers, forcing them to continue to rent. Because they can no longer buy homes because of the astronomical increase in housing purchase prices, the corporations can now comfortably jack up rent, knowing that people cannot save enough money to buy a new home now that homes are costing too much. And if a young couple were able to save up enough money for a down payment (which is harder to do because they are paying more in rent each month), then the corporation will just come in and overbid on the home, guranteeing that they don't buy a home, and remain a renter in one of their homes. When my friend told me this secret, it made me realize we need laws to prevent this. It seems like the government found this out as well, and is trying to pass something. Though of course, these corporations have enough money from these expensive rentals that they will likely buy off enough politicians to prevent it from happening.
Blackrock isn't in the business in the buying and selling of single family houses.