Should big corporations be allowed to buy single family homes

[Djgb13 2,339]

Been seeing a lot of this. A lot of big companies would buy hundreds of single family homes and then rent them out. Effectively preventing people from becoming homeowners. Not only that, they raise the rent so high people can’t afford them. I’m talking making 3 times the rent, having above a 700 credit score, not having any roommates, etc. Making it difficult for people to rent. 
 

Now on the other side, this is a free market. So they’re allowed to do that. Should this be something that should become illegal or at least regulated or should they be allowed to keep doing it? 

[JustinCharge 2,397]

this is a form of what is called "cornering a market". 

 

In finance, cornering the market consists of obtaining sufficient control of a particular stock, commodity, or other asset in an attempt to manipulate the market price. One definition of cornering a market is "having the greatest market share in a particular industry without having a monopoly".^{[citation needed]}

In nearly all cases, the company simply runs out of money and disbands before getting close to controlling prices. In the few cases where companies have purchased a dominant position in a market, governments and exchanges have intervened. Cornering a market is often considered unethical by the general public and has highly undesirable effects on the economy.^[2]

https://en.wikipedia.org/wiki/Cornering_the_market

[Djgb13 2,339]

15 minutes ago, JustinCharge said:

this is a form of what is called "cornering a market". 

 

In finance, cornering the market consists of obtaining sufficient control of a particular stock, commodity, or other asset in an attempt to manipulate the market price. One definition of cornering a market is "having the greatest market share in a particular industry without having a monopoly".^{[citation needed]}

In nearly all cases, the company simply runs out of money and disbands before getting close to controlling prices. In the few cases where companies have purchased a dominant position in a market, governments and exchanges have intervened. Cornering a market is often considered unethical by the general public and has highly undesirable effects on the economy.^[2]

https://en.wikipedia.org/wiki/Cornering_the_market

Black Rock is a major one

[TimHauck 2,633]

I don’t think you can make it “illegal,” but a lot of HOA’s are putting in new bylaws with things like you must own the home for a year before renting it, which would effectively prevent these companies from buying them.

[Hardcore troubadour 14,976]

Illegals have to live somewhere. That’s where the government comes in. 

[BirdGang 385]

Like you said Free Market, I’m not sure how you could effectively regulate and where would you draw the line? 

[iam90sbaby 2,503]

American corporations yes, foreign no.

[Hardcore troubadour 14,976]

Section 8. Guaranteed. 

[JustinCharge 2,397]

28 minutes ago, TimHauck said:

I don’t think you can make it “illegal,” but a lot of HOA’s are putting in new bylaws with things like you must own the home for a year before renting it, which would effectively prevent these companies from buying them.

the government has intervened when people try to corner a market.

[Brad GLuckman 519]

1 hour ago, Djgb13 said:

Black Rock is a major one

Yep they've been doing this for a while. They just signed up to help rebuild Ukraine now, too. Sure there won't be any corruption there.

[Hardcore troubadour 14,976]

Blackrock is the Goldman Sachs of the Biden admin. They are all over it. Expect things to go their way. Meet the new boss, same as the old boss.  Ca-Ching 

[Djgb13 2,339]

24 minutes ago, iam90sbaby said:

American corporations yes, foreign no.

I believe there’s Chinese companies or Chinese government doing this. Can’t remember cause I read about it a month or so ago 

[Djgb13 2,339]

5 minutes ago, Brad GLuckman said:

Yep they've been doing this for a while. They just signed up to help rebuild Ukraine now, too. Sure there won't be any corruption there.

Oh yea. I KNOW there’s corruption there. It’s blatantly obvious 

[Hardcore troubadour 14,976]

Blackrock has or controls 90 trillion in assets. That’s power. 

[BudBro 173]

Opendoor has 132 properties for sale in my city.  All of them have price decreases, most are listed for less than they were purchased, and are over 90 days on the market.  Good to see.  Zillow and Redfin flailing, too.  Blackrock and Vanguard under fire from investors for focusing on green issues instead of stockholder returns.

[IGotWorms 4,057]

Well that’s capitalism for you. Don’t see how you can stop people from buying houses if they have the means to do so

[Hardcore troubadour 14,976]

1 minute ago, IGotWorms said:

Well that’s capitalism for you. Don’t see how you can stop people from buying houses if they have the means to do so

I wouldn’t say a hedge fund with its tentacles all over our government buying up residential property capitalism. Call Me crazy. 

[IGotWorms 4,057]

1 minute ago, Hardcore troubadour said:

I wouldn’t say a hedge fund with its tentacles all over our government buying up residential property capitalism. Call Me crazy. 

Yeah I mean that’s the epitome of capitalism. So I guess you are crazy 

[Hardcore troubadour 14,976]

7 minutes ago, IGotWorms said:

Yeah I mean that’s the epitome of capitalism. So I guess you are crazy 

I’d say that’s the epitome of Insider dealing. 

[TimHauck 2,633]

2 hours ago, JustinCharge said:

the government has intervened when people try to corner a market.

What are you considering “the market”?  A neighborhood?  City? Metro area? The market of home sales or rentals?  In terms of ownership I think the most I’ve heard of owned by one company is something like 30% of a neighborhood, which I’m not sure would be enough to be considered cornering the market.  They do often end up being a significant portion of the rentals though (since it’s hard to find rentals in SFH neighborhoods), so that’s where there could be the best argument.   I would doubt most of the rents are within Section 8 limits, they are targeting families with decent incomes that just aren’t in a position to purchase.

Odd time for OP to bring this up though, I doubt these companies are going to be doing a whole lot of buying for the next year or more.  Will also be interesting to see if they sell any of the ones that were purchased in the last couple years depending on how much prices & rents drop.

[shorepatrol 1,870]

3 hours ago, TimHauck said:

I don’t think you can make it “illegal,” but a lot of HOA’s are putting in new bylaws with things like you must own the home for a year before renting it, which would effectively prevent these companies from buying them.

No it doesn't. They are more than happy to remodel and sit on it for a year. 

[Louie Kelcher 97]

Missed this thread over Christmas break

[Louie Kelcher 97]

This is good article explaining what's going on if anyone cares to educate themselves.

 

https://www.theatlantic.com/ideas/archive/2021/06/blackrock-ruining-us-housing-market/619224/

[Hardcore troubadour 14,976]

Triggered! Yeah, you didn’t post much that week. Lol. 

[League Champion 1,896]

It's a free market and not everyone can be a home owner. If the rent is too high then go somewhere else. The market eventually corrects all that. 

[WhiskeyCash 65]

3 hours ago, Hardcore troubadour said:

Triggered! Yeah, you didn’t post much that week. Lol. 

Sounds like he’s got a case of the CNNs 

[TimHauck 2,633]

On 12/29/2022 at 8:49 PM, shorepatrol said:

No it doesn't. They are more than happy to remodel and sit on it for a year. 

No they’re not.  They “remodel” (aka paint and put new carpets and vinyl flooring in) in like a week.  They’re not going to want to miss out on $25k+ for a year.  I believe many of them also make the tenants do the yard maintenance so that’s more costs they’d have, plus utilities.

[shorepatrol 1,870]

35 minutes ago, TimHauck said:

No they’re not.  They “remodel” (aka paint and put new carpets and vinyl flooring in) in like a week.  They’re not going to want to miss out on $25k+ for a year.  I believe many of them also make the tenants do the yard maintenance so that’s more costs they’d have, plus utilities.

You have no idea what you're talking about. As usual 

[TimHauck 2,633]

7 minutes ago, shorepatrol said:

You have no idea what you're talking about. As usual 

Yes I do.  I live in a town where many homes are owned by these companies (American Homes 4 Rent probably the most popular in my area), know people that have rented from them, and lived in a neighborhood that tried changing the HOA bylaws to no rentals in the first year for that exact purpose (it failed because as much as people like to complain about these companies, they still want to be able to sell to them if needed).   There have been some neighborhoods in the area though that have done it which killed these companies buying homes.

Feel free to point out specifically where I'm wrong though.  Maybe it takes longer than a week for them to renovate.  A month max.   But they're certainly not "more than happy" to sit on them for a year, especially not now with home prices and as a result rents as well dropping.

[shorepatrol 1,870]

2 minutes ago, TimHauck said:

Yes I do.  I live in a town where many homes are owned by these companies (American Homes 4 Rent probably the most popular in my area), know people that have rented from them, and lived in a neighborhood that tried changing the HOA bylaws to no rentals in the first year for that exact purpose (it failed because as much as people like to complain about these companies, they still want to be able to sell to them if needed).   There have been some neighborhoods in the area though that have done it which killed these companies buying homes.

Feel free to point out specifically where I'm wrong though.  Maybe it takes longer than a week for them to renovate.  A month max.   But they're certainly not "more than happy" to sit on them for a year, especially not now with home prices and as a result rents as well dropping.

Your dumbshit anecdotal "evidence" on everthing you post is specific enough. You're your own worst enemy. You're the metal football helmet dipshit aren't you? 

[Hardcore troubadour 14,976]

1 minute ago, shorepatrol said:

Your dumbshit anecdotal "evidence" on everthing you post is specific enough. You're your own worst enemy. You're the metal football helmet dipshit aren't you? 

Thats  the guy! 

[Louie Kelcher 97]

1 minute ago, shorepatrol said:

Your dumbshit anecdotal "evidence" on everthing you post is specific enough. You're your own worst enemy. You're the metal football helmet dipshit aren't you? 

Can you refute his evidence or you just go for the personal attack?

[TimHauck 2,633]

8 minutes ago, shorepatrol said:

Your dumbshit anecdotal "evidence" on everthing you post is specific enough. You're your own worst enemy. You're the metal football helmet dipshit aren't you? 

It's not anecdotal to say that a company intending to make money by buying thousands of homes is going to be "more than happy" to throw away $25k+ on a single one.   Speaking of dumbsh1ts...

[shorepatrol 1,870]

41 minutes ago, TimHauck said:

It's not anecdotal to say that a company intending to make money by buying thousands of homes is going to be "more than happy" to throw away $25k+ on a single one.   Speaking of dumbsh1ts...

You are the metal football helmet dipshit correct?

[shorepatrol 1,870]

48 minutes ago, Louie Kelcher said:

Can you refute his evidence or you just go for the personal attack?

"Evidence"? 

[Louie Kelcher 97]

15 minutes ago, shorepatrol said:

"Evidence"? 

Exactly, you're full of sh1t 

[TimHauck 2,633]

30 minutes ago, shorepatrol said:

You are the metal football helmet dipshit correct?

So what, I think saying an investment firm would be "more than happy" to throw away $25k+ might be even more stupid than that....

[kozmiq 70]

I'm more concerned about Churches able to do so without having to pay taxes.  ( And they're not even Donald Trump ! )

[TimHauck 2,633]

6 hours ago, Louie Kelcher said:

This is good article explaining what's going on if anyone cares to educate themselves.

 

https://www.theatlantic.com/ideas/archive/2021/06/blackrock-ruining-us-housing-market/619224/

I'm not sure I follow the logic here.   For one, the article isn't really specific about which projects are being blocked.  My gut would be it's primarily apartment complexes.    I don't think there's a huge correlation between new apartment buildings being built and the price to buy a single-family home.

And even if new housing developments are being blocked, new housing developments aren't typically targeted towards first time homebuyers.  I know I've certainly seen no shortage of new housing developments in the past couple years.

But I agree that the impact of big corporations buying homes is likely overstated. 

I honestly don't think anything "ruined" the housing market.   Feel free to accuse me of making everything about covid, but the clear inflection point during the recent runup in prices was covid.  For a couple reasons.  One, it made many people realize that they wanted their own space (2020).   But there were also a lot of people that likely didn't want to move in the middle of a pandemic, reducing the supply of homes on the market.  Then in 2021, the supply chain challenges caused the price of raw materials to increase, increasing the cost of building a new house which trickled down to existing houses as well.

[Louie Kelcher 97]

7 hours ago, TimHauck said:

I'm not sure I follow the logic here.   For one, the article isn't really specific about which projects are being blocked.  My gut would be it's primarily apartment complexes.    I don't think there's a huge correlation between new apartment buildings being built and the price to buy a single-family home.

And even if new housing developments are being blocked, new housing developments aren't typically targeted towards first time homebuyers.  I know I've certainly seen no shortage of new housing developments in the past couple years.

But I agree that the impact of big corporations buying homes is likely overstated. 

I honestly don't think anything "ruined" the housing market.   Feel free to accuse me of making everything about covid, but the clear inflection point during the recent runup in prices was covid.  For a couple reasons.  One, it made many people realize that they wanted their own space (2020).   But there were also a lot of people that likely didn't want to move in the middle of a pandemic, reducing the supply of homes on the market.  Then in 2021, the supply chain challenges caused the price of raw materials to increase, increasing the cost of building a new house which trickled down to existing houses as well.

I posted that article to clear up misinformation that was being spread, ie that Blackrock is going around buying a bunch of residential property to squeeze people out of their homes.  Its going around conservative TikTok.  I bumped the thread because it was repeated in another thread, that blackrock is gonna build a bunch of affordable housing.