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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWall Street Has Spent Billions Buying Homes. A Crackdown Is Looming.
https://www.wsj.com/real-estate/wall-street-has-spent-billions-buying-homes-a-crackdown-is-looming-f85ae5f6Wall Street Has Spent Billions Buying Homes. A Crackdown Is Looming.
Lawmakers say investors that scooped up hundreds of thousands of houses to rent out are driving up home prices
By Will Parker
April 29, 2024 5:40 am ET
Wall Street went on a home-buying spree. Now, more lawmakers want to stop it from ever happening again.
Democrats in the U.S. Senate and House have sponsored legislation that would force large owners of single-family homes to sell houses to family buyers. A Republicans bill in the Ohio state legislature aims to drive out institutional owners through heavy taxation.
Lawmakers in Nebraska, California, New York, Minnesota and North Carolina are among those proposing similar laws.
These lawmakers say that investors that have scooped up hundreds of thousands of houses to rent out are contributing to the dearth of homes for sale and driving up home prices. They argue that investor buying has made it harder for first-time buyers to compete with Wall Street-backed investment firms and their all-cash offers.
Investors of all sizes spent billions of dollars buying homes during the pandemic. At the 2022 peak, they bought more than one in every four single-family homes sold, though more recently their activity has slowed as interest rates rose and supply became tighter. Two of the largest home-buying firms, Invitation Homes and AMH, are publicly traded companies, while a number of other companies, backed by private equity, hold portfolios of tens of thousands of homes nationwide.
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TexasBushwhacker
(20,257 posts)Residents are stuck because the cost of relocating mobile homes is in the thousands. Lot rents double, triple or more in just a few years. This includes mobile home parks that are for senior citizens.
dalton99a
(81,708 posts)Johnny2X2X
(19,311 posts)If Dems were given the power to, they would fix the problem almost immediately. But the GOP will fight tooth and nail for Wall Street and the investor class.
It's a multi pronged problem. Air BnB is a big part of it, corporations figured out they can buy homes in large chunks and rent them out on Air BnB, their equation for a fair price to buy is totally different than the equation a single family will have. Air BnB is going to have to be regulated to how much and who can own them. It's one thing for an individual with a Summer Home or Winter ski cabin using Air BnB to rent them out, it's another entirely for a real estate company to own 30 homes in a city and rent them out to short term renters.
And trailer parks are part of this too, investment groups realized about a decade ago that there are almost no regulations to pretect people living in trailer parks. SO they started buying them up, jacking up rents and fees, and neglecting them.
harumph
(1,923 posts)(e.g., under 2 homes) and I hope that any law will take those into consideration.
Johnny2X2X
(19,311 posts)And that's kind of what Air BnB started as. Normal people renting their homes for a few weeks at a time when they were away. Or having a 2nd home they could rent half the year. But it became a way for people to own hotels basically. And then it got bought up by groups. And it has suffered as an experience as a result too. Air BnBs are no longer much cheaper than hotel rooms, and they more often than not now come with a bunch of rules and fees that corporations are prone too. Been using them from the get go when I travel, it's changed a ton.
But even with these bidding wars started by Air BnB corporations, home ownership n the US is still higher today than it was in the 1960s and 70s. It's not far off from recrod highs of the 90s and 2000s either.
Dulcinea
(6,700 posts)3 corporate giants own 11% of rental properties in metro Atlanta. It's destroying the housing market here, & it sucks. https://www.11alive.com/article/news/local/gsu-study-atlanta-single-family-homes-corporate-landlords-own-11-percent/85-7df30b4e-86c7-4591-a1b3-596a1970b090
dalton99a
(81,708 posts)There should be a law against the crap that's been going on in the housing market
MOMFUDSKI
(5,823 posts)Dollar Short. This should have been strangled in its crib.
jmbar2
(4,927 posts)Investing groups are holding seminars on how to purchase beat down homes in depressed towns, fix them up, and then rent them to Section 8 tenants. They also help find the houses, and link folks up to funding. They boast of phenomenal profits thanks to generous funding from the government for Section 8 landlords.
Not sure if it's a good thing or not. It does provide decent, affordable housing to the most needy, and fills a need for S8 landlords. The boasting about profits makes me very uncomfortable.