Hacker News Reader

Comment by roadside_picnic | Hacker News Reader

Thank you for mentioning this! There's this weird, persistent meme that large corporations are buying up all the housing and nobody owns homes anymore, which is fundamentally not supported by the data.

There are shifting trends in generational home ownership rates, but these are still just initial trends we're seeing. If you look at the data [0] owner occupied has gone down from the 2000s housing bubble, but in the grand scheme of things is not even particularly low.

People also have this mistaken belief that investors like Black Rock are buying up huge swaths of property, when in reality most "investment" properties are bought by families and individuals, consider anyone who know who owns an AirBNB rental or other rental property, they would be considered "investors".

Most Americans still live in a house, and own that house (or at least, some member of their household owns it).

0. https://fred.stlouisfed.org/series/RHORUSQ156N

View on HN

I don't know about the United States, but in (parts of) Europe it is the case. "Nobody owns homes any more" is an exaggeration of course, but things are not alright in the housing market, in part because private corporations are buying up quite a large percentage of the housing stock to rent. I think in Ireland it's about half.

Like I said, I don't know about the US. It's a big place and you're probably taking too much of a "grand scheme of things" view here. Aside from geographical diversity, total % of home ownership doesn't change that fast – lots of older people already own homes, their children often inherit those homes. Houses aren't like hotdog sales and numbers change slowly.

What matters more is how much does an average 25 or 30 year old pay in housing costs? What hope does someone with a decent (but not exceptionally well-paid) job have of purchasing a house? A single % of home ownership across the entire population doesn't really capture that. Doubly so for such a large country as the US. I'm sure there are affordable homes out in the sticks, but also ... no jobs. That might work for the remote software dev, but not everyone is a software dev.

In Ireland the total housing ownership has fallen, but not dramatically. However, the reality for people not already having a home is quite bleak. Buying a house now is significantly more expensive than it was a decade or two ago, as is renting. I could buy an apartment on my own ten years ago with a salary that really wasn't all that great. I'd have no hope today. My rent today is about three and a half times what it was 15 years ago. There is a generation of working 20 and 30-year old who are still living at home because they can't really afford to move out.

> "Nobody owns homes any more" is an exaggeration of course, but things are not alright in the housing market, in part because private corporations are buying up quite a large percentage of the housing stock to rent. I think in Ireland it's about half.

This is a _really_ popular meme, but it's not true. About 50% of new homes are bought by owner-occupiers, about 25% by local authorities and approved housing bodies (https://www.citizensinformation.ie/en/housing/local-authorit...), 10% pension funds and institutions (these are the 'private corporations' you refer to), and the remainder are small landlords, holiday homes etc etc.

I think sometimes people see "50% of new homes are bought by owner occupiers" and read it to mean "and thus the other 50% are bought by evil corporations" (people also tend to forget about the 'new' bit; second-hand homes are much more likely to be bought by owner-occupiers, as REITs and pension funds largely don't want to touch them, and nor do approved housing bodies; local authorities do sometimes buy individual second-hand homes, usually from private landlords), but really the bulk of the remainder is social housing.

The ridiculous rents are driven by the fact that we're just not building enough homes. Not that we're not building a lot; we have one of the highest per capital rates of homebuilding in the OECD, but there was a period of 7 or 8 years where we built almost nothing, and that's a really hard gap to bridge.

Interesting! Would love to see a reference for your percentages

Up to 2023 in a slightly dodgy graphical representation here: https://housingireland.ie/composition-of-purchasers-of-new-h... (note that y axis is number of sales, but labels are percentage of sales!)

If sufficiently masochistic you can also wrestle it out of the CSO's horrible website for 2024, I think.

In Ireland, approximately 41% of young adults aged 18 to 34 live with their parents as of 2024. It was 32% in 2011. This is an economic abhorration that has stolen significant independent adult lifespan from an entire generation.

This is caused by an Irish cultural distaste for apartments - as they're generally not setup for modern living, are typified by poor soundproofing and insulation, and marred by fire insulation and other scandals - leading to a decreased stock. Include the Help-To-Buy scheme applicable only to new-build houses on greenfield estates, and the HAP social-welfare payment which set an artificial floor on rents for apartments, and its the case that the average apartment rent is 1.5-2x the cost of servicing the mortgage at a 90% LTV.

This results in an average rent in Dublin of €2,500, with Open-market rents in the capital rising at annual rate of 5.2%. The most recent median (50th percentile) salary is €43,221, which comes from a 2023 CSO report. That's a monthly net salary of €3,000 per person.

The National Asset Management Agency, set up in the recession to take on all the in-default property and babysit it till prices rose again, has a huge part to play. Combine this with a non-fit-for-purpose Planning and Appeals process, and you literally have builders suing the government for blocking developments.

As of November 1st 2024, there were just over 2,400 homes available to rent across the ENTIRE COUNTRY OF IRELAND, down 14 per cent on the same date a year previously and well below the 2015-2019 average of almost 4,400.

All of this laid the foundations for disaster. Now the increased materials and energy costs since Covid-19, combined with a relative collapse in our building sector prior, have meant that building apartments in Dublin has largely become commercially unfeasible, as construction costs are now higher than what buyers are willing to pay.

https://www.independent.ie/business/unviable-construction-st...

    > In Ireland, approximately 41% of young adults aged 18 to 34 live with their parents as of 2024.

This is wild. Can I safely assume that this is inversely correlated to marriage rates (and age of first child)? I assume that it looks like Italy. "Up next: Demographic crisis!"

> I think in Ireland it's about half.

It's about 1/3rd AFAIR.

I do agree that Ireland has experienced a massive change in house prices from 15 years ago, but 15 years ago was the bottom of a bust after the boom so potentially not the right comparison point.

I do mostly agree with your points, and it's really bad but it's important to contextualise some of those points.

One important data point is that houses have become much more expensive compared to income in the last decades. When I lived in CA, my plumber neighbor told me he bought his house in the 70s for 80000 on a salary of 40000. Today he would probably pay 800000 for the same house but make maybe 100000 or a little more.

It's definitely harder to buy a house these days.

Houses today are vastly larger. Cost/sq ft in all but the few most expensive places has been nearly constant under inflation adjusted price for an incredibly long time. A huge majority of the population lives in such places.

Here's a size list that is commonly shared https://www.newser.com/story/225645/average-size-of-us-homes...

When you figure in # of people in such houses, the avg person has vastly more space https://www.reddit.com/r/REBubble/comments/14hayqq/average_h...

New builds may be larger today but the vast majority of real estate on the market are not new builds

I bought my house in 2018. It was built in 1997

It is not vastly larger than it was in 1997, but I still paid 2018 prices for it

Most people aren't buying new builds

Prices change due to inflation among other things, which is over 50 % from that time period. And given that the median house age (not median age of sold house!) is 40 years, you did buy a much newer house than the majority of people have.

A few years back, median age of sold house was 27 years. So by that metric you bought even a newer house than the majority of house sales.

Your 1997 house is almost certainly much larger than the median 1950 house.

And, your single data point in no way invalidates aggregate statistics.

$40,000 in 1975 is over a quarter million 2025 dollars.

You can't buy on the west coast for a quarter million. A house big enough to start a family will likely start at a half million, and in some communities will come with hefty tax burdens.

in 2025 anything vaguely desirable in a coastal-ish city is starting at more like 600-700k. actual decent houses will be 1MM or more.

the folks in those areas, if you owned a house for the last 20 years, are now richer than ever due to that property appreciating. but the younger generation is absolutely screwed

> if you owned a house for the last 20 years, are now richer than ever due to that property appreciating.

Only if you sell it, and move somewhere with a much lower cost of housing.

If there is a spare bedroom in your HCOL location, renting that out lets you get some incoming cash flow without having to move away to a LCOL location.

You don't get "rich" from renting out a spare bedroom.

HELOC and never pay it off until you die

The north coast has cheap housing.

Sure, but you can certainly afford a house on the West Coast with an income of $250k.

the higher prices are affected by the corporate buying of single family homes. for every home a corp buys, that's one less for individuals to buy. if the number of buyers remains the same but fewer homes are available, prices go up--seller's market. yes, prices go up adjusted for..., but inventory more competitively sought. the other issue is that the average buyer is looking to buy with financing while corps are paying cash. that makes for such a smoother transition for the seller that it is hard for them to turn down cash offers.

after corps, we have foreign buyers also coming in with cash offers. i know of one specific house that is empty for the majority of the year purchased by foreign owners specifically for their kid to live while attending college. the kid chose to not go to that school, so the house sits empty except for when some property manager comes by to "check in" on the place.

so while this thread is discussing still showing decent ownership percentages, those numbers are glossing over some of the "trends" in modern real estate.

It's overwhelmingly due to monetary policy which has inflated assets and depreciated real wages for decades.

https://wtfhappenedin1971.com/

Restrictive zoning laws preventing construction in coastal cities is also a major factor. The cities which see the greatest declines in rents have the greatest increases in supply.

https://www.nmhc.org/contentassets/f9a5ef47d06143e6b8355cfad...

> affected by the corporate buying of single family homes

> after corps, we have foreign buyers also coming in with cash offers

As someone mentioned earlier in the thread, these are memes that are not actually backed by data - commonly perpetuated by groups that blame most issues on billionaires/corporations/investment firms.

So you're insinuating that the specific example of a house sitting empty owned by a foreign buyer is made up?

In my neighborhood specifically, there are homes being bought not by single families but specifically buy management companies so they can then rent the property. To deny this happens is just as much of a stick your head in the sand meme as what you are accusing me of.

Management companies will only buy a house if they think they can profit on it, and the price of the house is a cost for them too. This links the affordability of both types of housing: low rents can't support expensive real estate, and vice versa. The rental payments have to pay for the management company's mortgage.

No one is denying that it ever happens. It happens in so few numbers that it has no impact on the overall real estate market.

That's why your anecdote is meaningless and can be dismissed immediately.

So you're insinuating that the specific example of a house sitting empty owned by a foreign buyer is made up?

I'm sure that happens occasionally. It's not nearly as significant as exclusionary zoning and other bad policies that prevent housing from being built.

In my neighborhood specifically, there are homes being bought not by single families but specifically buy management companies so they can then rent the property

Even in that case, the homes are still on the market.

They're saying it's overemphasized, which is why we don't rely on anecdata.

bring the data to back your claims or be ignored like you are ignoring all the responses to you

Interest rates have fallen dramatically over this period, which increases the ratio that is affordable.

High interest with low price has the advantage that you can decide to pay more into the principal, reduce the interest you are paying and so reduce the total amount you are paying. You can’t do that with high price and low interest.

Yes and: You can also refinance later if rates fall.

At 18% interest which happened in the 70s your yearly payments would have been 14468.02 or 36% of your income. A couple years ago you could get 3% rates and so your payment on that house would be 40473.98 or 40% of your income, not much difference (and likely the house is larger). At todays 6% interest the payment is 57556.85 or 57% of your income and so not affordable, but this is a very recent thing.

This is both ignoring inflation, and the potential to shorten the duration of the loan.

Inflation is a factor in a few years but never today. Now inithe 1970s high inflation meant that a house you can barely afford becomes a small part of the budget in a couple years while the small inflation of today means a house you can barely afford today is still a big part of the budget in 5 years - but that is not a consideration of today.

It absolutely is a massive factor; because people plan a few years ahead. Consider how much it changes what you can afford if you save one year worth of payments in each case.

There is also less need to get the maximum possible loan if house prices are lower as a ratio to income.

A good, experienced plumber would make a lot more than that in CA.

These are the numbers my neighbor gave me. No idea how accurate they are. I think it’s well known that the average house price to income ratio has gone up a lot in the last decades.

Sorry, there's no way a plumber in the 70s made 40K.

Yes, it’s surprised me how this meme was everywhere in the comments while the data does not support it. I’d bet it’s splashy headlines in news outlets. Important to correct it so that policy is focused on what’s most effective.

Blackrock sounds scary

People absolutely also conflate it with Blackstone and even Blackwater.

tbh conflating blackrock and blackstone is pretty fair. Their named similarly because it's the same people with just a slightly different business.

It's another example of mistaking the current trading trends for the overall asset reality. Like NFTs, TSLA, and house prices, a relatively small amount of daily trading money can move the "market cap" quite a lot.

And those old folks that took their home equity and used it to buy property for an AirBNB are in fact an example of the rich/old folks screwing the young generation hard. (Other examples: vote to reduce taxes, to increase tuition, stop the free market from building more housing, do nothing on global warming, let the economy be swallowed by health care and financialized scams). As are the people that own and rent 3 houses, while their grandkids have to move far away. (Disclaimer: I live in San Jose, and my adult kids will never be able to live near me).

> There's this weird, persistent meme that large corporations are buying up all the housing and nobody owns homes anymore, which is fundamentally not supported by the data.

They are and the trend is there. The housing market moves slowly and it takes time to chip away enough at the larger stat. Once the boomer's age out, even with wealth and asset transfer, let's revisit this and see how it looks. I'd bet 2/3 ownership looks more like 1/2 or less by then, which is a significant drop and it probably will only continue from there.

Reply on news.ycombinator.com