US Housing Affordability Hits Worst Point in Nearly Four Decades

So, by your definition, did I contribute to the auto shortage?

Nobody is stupid enough to own an apartment complex in their own personal name without the protections of some kind of corporate structure. If that and/or a number of units owned that is lower than the size of an apartment complex are part of the definition of "institutional investor," the definition is circular.

This is what I mean about left-wing science denialism. Try even reading your own article

1. "According to the RHFS, individual investors were the biggest group in the rental housing market in 2015, accounting for 74.4 percent, or 16.7 million rental properties, followed by limited liability partnerships (LLPs), limited partnerships (LPs), or limited liability companies (LLCs) (14.8 percent);"

This is literally the exact opposite of your claim. But let's pretend that your claim was correct:

2. They're price takers.

3. Why is this a bad thing? If this were true (it isn't), then they're basically the only people who will rent at all anymore. The alternative is net worse for affordability - places without institutional investors have far fewer shares of people renting because there is literally nobody offering places for rent.

e: And of course I'm downvoted simply for pointing out that the article linked says the opposite of the claim.

They are simultaneously responsible for bidding up the price of homes while paying far below the average price for a home in pretty much every state they are present in.

Texas is effectively one of the only markets with a substantial proportion of new buyers being institutional investors and this is largely due to the number of dilapidated homes in the area.

"Corpos" are filling in the gap because a ridiculously sticky real estate market means that there are a ton of places that could easily bear more renters. These corporations are typically paying far below the average for homes in whatever state they are buying in [0] (somehow paradoxically this becomes bidding home prices up) and typically allow more renters to enter the market rather than being priced out.

[0]: https://www.corelogic.com/intelligence/the-beginning-of-the-...

Regardless, these investors are paying way below the typical average for new homes in Texas, but somehow responsible for the affordability crisis?

However, there are levels of debt-to-income that prevent the borrower from getting that time (insolvency exists).

I am hoping policy-makers have a more sophisticated approach than 'money printers go brrr'. Economies like price stability. Deflation and inflation can be destructive in the extreme.

Anything to quote here for this? I'm inclined to believe you are probably right, but an awful lot of real estate has changed hands in the past 5ish years... all of which is hugely inflated above actual property values in a normal market.

Lots of people with FOMO bought into houses way above their weight, and thought the rental market was a "game" anyone can play.

1) Actively looking for that right renter willing to pay a premium for a particular property/part of town.

2) There's probably tax benefits to the lost income and mortgage expenses while looking for a renter.

It is intended to make the earth warmer for others (future Earth entrants).

It is redistributive in that it heats the earth for future, richer, more technologically advanced populations that will be more equipped to handle the heat and runaway warming, while allowing more wealth accumulation for the less technologically advanced (and thus more deserving) current human society.

yes, in very much the same way as climate - destroying what exists (affordable housing) in order to benefit incumbents is bad politics, bad policy, and bad ethically.

nevermind that, looking at the poll, most indicate that rent controlled apartments fall into the hands of the rich anyways - who then are protected from poorer renting populations moving in. See: New York City.

As redlining and segregation had a lot of old white people shaking in their boots complaining about property values, old white people who worked for local government (who were also largely landowners) began implementing zoning regulations that effectively banned any sort of housing being built that was affordable to many citizens. Such as apartment complexes, townhomes, quadplexes, smaller homes, etc.

In today's world, we're now dealing with the continued effects. Wealthier areas of town that do not allow ANY multifamily house. Less wealthier areas of town that do not allow homes to be built off-site, or to have under a certain square footage, effectively ensuring homes there are more expensive than they should be. And then the poorer areas of town only allowing multifamily housing right next to industrial/commercial zoning areas. Effectively preventing anyone (outside of property investors) from affording to own a multifamily property, let alone even be able to legally build a single-family home.

As the separations between middle class and lower class begin to blur, it makes the situation worse for everyone, outside of the financially well-off who either made it big with a business, or have owned property for decades at that point.

Zoning was redefined from a health and safety perspective, to a legal, local government tool to artificially inflate property values by unfairly limiting the types of homes that could be built, and putting the poorer workers and "undesirables" in unsafe communities full of industrial factories, low-wage jobs, and no vertical movement for the community to grow.

The process in the Soviet Union might not have involved financial capital, but it involved human capital (i.e. if your profession was not "respectable", or if you were ever convicted of a criminal act, you might not receive permission to get an apartment (or even a room) in a top tier city like St. Petersburg or Moscow)

Industrialization led to many dirty cities especially before sanitation technology was deployed. Restrictions on more than e.g. 8 unrelated people per house, minimum window requirements, separating the meat packing district from a pure residential neighborhood were in response to tenements which were deathtraps in fires.

Not now, no.

You have to compare the money you would spent on the down payment (and excess from mortgage) to the returns you would get from investing that money directly.

And as I said, the only reason mortgages are so cheap is due to the massive, massive amount of government subsidy in favor of owners - if owners were remotely exposed to the true cost of borrowing, it would not even be particularly close.

So if you feel a need to buy a home, you should be able to do it. But the government should not be propping up unsustainable markets at considerable risk to the rest of us to let you do so - if you can afford a home and get a bank to lend you the money and assume the risk, you should be able to. But I am not sacrificing my ability to afford quality housing to give you government-guaranteed mortgages, it's a massive moral hazard.

If you need the fixed-income security, pay for it.

Some European countries have things like the imputed rent tax (basically taxing homeowners as if they were renting their own home). This goes a long way towards balancing the scales between homeowners & renters.

That said, I mentioned stigma, I didn't say anything about culture - and I'm not sure why it is at all relevant to my point.

Dense cities are more desirable to live in, but that induces more demand, so even though the cities generate more wealth, the equilibrium between supply and demand still skews to people wanting to pay more of their income to bid on a limited supply of housing (even if that supply is larger, more demand is simply induced). We should allow more building (and denser building) in popular cities, but we shouldn’t do that blindly thinking that it would somehow make housing more affordable.

You can google housing supply shortage for basically any country with a good economy, not just the USA. The only way to get around it is somehow suppress demand (low paying jobs in Berlin 20 years ago, or a declining population in Japan).