Doesn’t matter, because even if Berkshire Hathaway is eliminated from the bidding, when a dozen buyers with $200k or $300k in buying power are in the market and only one house is for sale because it’s literally illegal for more to be built, only one of you is going to be able to get the house!
I really don’t get your angle. Let’s say there are 8 entities seeking a house, 3 of which are corporations. Ban corporations from owning single family homes, and there’s an immediate drop in demand, so the current supply satisfies more individuals. Why are you arguing against this?
Let’s say there are 8 entities seeking a house, 3 of which are corporations. Ban corporations from owning single family homes, and there’s an immediate drop in demand
No there is not. Those corporations exist to make profit, and profit (in the long run) only comes from either tenants paying to occupy the house or selling it on to some other owner who will then either occupy it themselves or find tenants of their own. Even if it’s a speculative bubble right now, sooner or later that game of musical chairs has to end and people have to sit down; otherwise they lose.
i think the problem of institutional investors is mostly that they’re unnecessary middle-men, taking a slice of the cake while not actually providing anything of value.
they buy the house, then rent it out to the local population. in the end, they make a profit that way, otherwise they wouldn’t do it. that is money that could have gone into the local community instead.
either you need local middlemen, like the municipality (which i am advocating for!) or people need to buy the houses directly themselves. i remember reading an article that renting is often better for inhabitants since they don’t need to do a down-payment and also they carry less risk that way. also interestingly many can build more wealth by renting+investing instead of house buying. ~~https://www.moneydigest.com/1580083/renting-vs-owning-both-can-help-you-build-wealth-according-to-personal-finance-expert/~~
How many properties is BH sitting on unsold? How many are going to open up with the death of the Boomer homeowner generation?
Between 13.1 million and 14.6 million Boomers are projected to “exit homeownership” between 2026 and 2036. Who will own those homes when they are gone?
it’s literally illegal for more to be built
Show my the corner is the country where it is illegal to build new homes
We have, if anything, an enormous vacant housing surplus. What we lack is jobs paying at the going mortgage rate
There are dumb laws in some places privileging things like sfh over apartments, to the point of exclusion. But more to their point:
i stubbed my toe, so this giant steel I beam that has impaled me is helping actually. I need the ton if steel currently pressing up against my remaining lung and protruding 20 feet in front of and behind me, or i wont be able to walk.
Show my the corner is the country where it is illegal to build new homes
Just look at any zoning map. It’s all the (usually) yellow parts, i.e. the single-family-zoned areas, which make up the vast bulk of most cities’ residential land area.
We have, if anything, an enormous vacant housing surplus.
Sure, in the exurbs nobody actually wants to live in!
Are you claiming that you can’t build homes in a residential neighborhood?
After the lots have already had single-family houses on them and you aren’t allowed to subdivide or replace them with multifamily buildings? Yes! That’s exactly what I’m claiming!
Every single-family house in the close-in parts of the city represents the physical displacement of multiple families that could have lived in that space if it had been a multifamily building instead. Those families are literally forced further out into the suburbs, and then have to commute back in. That’s where the traffic, high prices, lack of walkability, pollution, obesity crisis due to sedentary lifestyles, etc. etc. etc. ad nauseum all come from!
I’m getting really sick and tired of you trying to play coy with terminology, or whatever the Hell it is you’re trying to do. Are you really so fucking dense that you’re confused by what I wrote?
It’s illegal to build multi-family (i.e. more housing) in areas zoned for single-family. What part of that did you not understand?
It’s illegal to build multi-family (i.e. more housing) in areas zoned for single-family.
There is no shortage of real estate for multi-family dwelling. But, in practice, what you’re advocating is more private landlords collecting rents on property the occupants don’t own.
The appeal and demand of suburbia is in the prospect of real land ownership, rather than perpetual serfdom.
Do you think these investors just have magic unlimited funds to hoard vacant housing forever? No. They exist to make a profit, which means sooner or later they either have to get occupants into those units or sell them on to somebody who will. This “additional” demand from property hoarders who apparently (according to your logic) love vacant buildings because they’re fucking morons who hate money is, in the long run, fictional.
Look, if you want to do something about the investors because of inequality or unfairness or whatever, have at it. I’m just saying that if your goal is to fix housing prices, zoning reform would be vastly more effective as a strategy.
I did the math in another comment. The TL;DR is that the maximum benefit you could have by eliminating investors is limited to the amount they’re participating in the market in the first place (which is much less than 100%). Meanwhile, simple zoning reforms are capable of doubling, 10x-ing, or more the amount of supply.
You didn’t do any math, and your assertion that the change in pricing is proportional to the market share is completely wrong. That’s not how pricing in markets works.
The TL;DR is that the maximum benefit you could have by eliminating investors is limited to the amount they’re participating in the market in the first place (which is much less than 100%).
Since we were talking about the price, I assumed that the “maximum benefit” was referring to that. Otherwise you’d be ignoring my point, so I was giving you the benefit of the doubt.
The maximum it can increase the supply of housing is much less than 100%.
(Also, I realize now that’s not quite right because of the way percentages work: e.g. if the investor owned all the houses and left them vacant, then eliminating the investor and putting them back on the market would technically increase the supply ∞%. The more correct way would be to say it could increase back to 100% of what it was originally.)
The point is, the amount of housing that could be made available has an upper bound of the amount that the investors are keeping vacant, which is only some fraction of the total that currently exists. Meanwhile, allowing higher density could allow orders of magnitude more housing to be created.
What purpose does bh serve here? And what drugs are you doing to believe this shit?
Why are you misrepresenting my argument? I never claimed BH served a purpose. If anything, my argument is closer to the opposite, which is that their presence or absence makes little difference at all.
What drugs are you doing to disbelieve that physical space exists and that not everybody who wants a single-family house with a yard in the middle of a fucking city gets to have one?
If it makes no difference then it needs to go. Its a huge investment of resources and planning permission. Spending that on no difference is insane at a societal level!
Doesn’t matter, because even if Berkshire Hathaway is eliminated from the bidding, when a dozen buyers with $200k or $300k in buying power are in the market and only one house is for sale because it’s literally illegal for more to be built, only one of you is going to be able to get the house!
I really don’t get your angle. Let’s say there are 8 entities seeking a house, 3 of which are corporations. Ban corporations from owning single family homes, and there’s an immediate drop in demand, so the current supply satisfies more individuals. Why are you arguing against this?
No there is not. Those corporations exist to make profit, and profit (in the long run) only comes from either tenants paying to occupy the house or selling it on to some other owner who will then either occupy it themselves or find tenants of their own. Even if it’s a speculative bubble right now, sooner or later that game of musical chairs has to end and people have to sit down; otherwise they lose.
i think the problem of institutional investors is mostly that they’re unnecessary middle-men, taking a slice of the cake while not actually providing anything of value.
they buy the house, then rent it out to the local population. in the end, they make a profit that way, otherwise they wouldn’t do it. that is money that could have gone into the local community instead.
either you need local middlemen, like the municipality (which i am advocating for!) or people need to buy the houses directly themselves. i remember reading an article that renting is often better for inhabitants since they don’t need to do a down-payment and also they carry less risk that way. also interestingly many can build more wealth by renting+investing instead of house buying. ~~https://www.moneydigest.com/1580083/renting-vs-owning-both-can-help-you-build-wealth-according-to-personal-finance-expert/~~
edit: damn it i can’t find the article anymore
How many properties is BH sitting on unsold? How many are going to open up with the death of the Boomer homeowner generation?
Between 13.1 million and 14.6 million Boomers are projected to “exit homeownership” between 2026 and 2036. Who will own those homes when they are gone?
Show my the corner is the country where it is illegal to build new homes
We have, if anything, an enormous vacant housing surplus. What we lack is jobs paying at the going mortgage rate
There are dumb laws in some places privileging things like sfh over apartments, to the point of exclusion. But more to their point:
Just look at any zoning map. It’s all the (usually) yellow parts, i.e. the single-family-zoned areas, which make up the vast bulk of most cities’ residential land area.
Sure, in the exurbs nobody actually wants to live in!
Are you claiming that you can’t build homes in a residential neighborhood?
The exurbs were very popular during COVID work from home
After the lots have already had single-family houses on them and you aren’t allowed to subdivide or replace them with multifamily buildings? Yes! That’s exactly what I’m claiming!
Every single-family house in the close-in parts of the city represents the physical displacement of multiple families that could have lived in that space if it had been a multifamily building instead. Those families are literally forced further out into the suburbs, and then have to commute back in. That’s where the traffic, high prices, lack of walkability, pollution, obesity crisis due to sedentary lifestyles, etc. etc. etc. ad nauseum all come from!
Are you suggesting a housing ban is when you build a house and I can’t knock your house over to build a new one with more units?
I’m getting really sick and tired of you trying to play coy with terminology, or whatever the Hell it is you’re trying to do. Are you really so fucking dense that you’re confused by what I wrote?
It’s illegal to build multi-family (i.e. more housing) in areas zoned for single-family. What part of that did you not understand?
There is no shortage of real estate for multi-family dwelling. But, in practice, what you’re advocating is more private landlords collecting rents on property the occupants don’t own.
The appeal and demand of suburbia is in the prospect of real land ownership, rather than perpetual serfdom.
Why are you lying?
If there weren’t unmet demand for multifamily, the NIMBYs wouldn’t have to resort to a law to stop people from building it.
So suddenly the law of supply and demand conveniently no longer applies? By removing demand from the market, we’re not lowering prices?
Do you think these investors just have magic unlimited funds to hoard vacant housing forever? No. They exist to make a profit, which means sooner or later they either have to get occupants into those units or sell them on to somebody who will. This “additional” demand from property hoarders who apparently (according to your logic) love vacant buildings because they’re fucking morons who hate money is, in the long run, fictional.
That doesn’t matter! They are still inducing extra demand, which still raises prices for normal people trying to buy homes.
Look, if you want to do something about the investors because of inequality or unfairness or whatever, have at it. I’m just saying that if your goal is to fix housing prices, zoning reform would be vastly more effective as a strategy.
I did the math in another comment. The TL;DR is that the maximum benefit you could have by eliminating investors is limited to the amount they’re participating in the market in the first place (which is much less than 100%). Meanwhile, simple zoning reforms are capable of doubling, 10x-ing, or more the amount of supply.
You didn’t do any math, and your assertion that the change in pricing is proportional to the market share is completely wrong. That’s not how pricing in markets works.
That’s not at all what I said. If you’re going to claim that I’m wrong at least have the decency to not misrepresent my argument.
How else am I supposed to understand this quote?
Since we were talking about the price, I assumed that the “maximum benefit” was referring to that. Otherwise you’d be ignoring my point, so I was giving you the benefit of the doubt.
The maximum it can increase the supply of housing is much less than 100%.
(Also, I realize now that’s not quite right because of the way percentages work: e.g. if the investor owned all the houses and left them vacant, then eliminating the investor and putting them back on the market would technically increase the supply ∞%. The more correct way would be to say it could increase back to 100% of what it was originally.)
The point is, the amount of housing that could be made available has an upper bound of the amount that the investors are keeping vacant, which is only some fraction of the total that currently exists. Meanwhile, allowing higher density could allow orders of magnitude more housing to be created.
So we should let bh get the house, instead of any of us?
What purpose does bh serve here? And what drugs are you doing to believe this shit?
Why are you misrepresenting my argument? I never claimed BH served a purpose. If anything, my argument is closer to the opposite, which is that their presence or absence makes little difference at all.
What drugs are you doing to disbelieve that physical space exists and that not everybody who wants a single-family house with a yard in the middle of a fucking city gets to have one?
If it makes no difference then it needs to go. Its a huge investment of resources and planning permission. Spending that on no difference is insane at a societal level!