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re: What should be done about investors buying up homes?
Posted on 5/20/24 at 1:34 pm to RogerTheShrubber
Posted on 5/20/24 at 1:34 pm to RogerTheShrubber
quote:
There has been plenty of new construction. Its being sold to corporations.
I can only speak to the KC market but this is a true statement.
I personally know a builder who I have done business with in the past has two subdivisions he is doing as BTR - Build to rent - all single family homes.
1st one - 75 homes - 4 or 5 bed, 2.5 baths, 2 car garage
2nd one - 173 homes - 3 or 4 bedroom, 2 car garage.
The hedge funds are eating these up. I know Main Street Renewal ( Amherst Holdings ) has the majority of one subdivision in Independence and has holdings in other areas as well ( new construction ).
2
Posted on 5/20/24 at 1:35 pm to RogerTheShrubber
What is industrial homes?
Posted on 5/20/24 at 1:38 pm to Big Scrub TX
loans for investment properties are the highest rate on any type of mortgage require a min 20% down 30% down if you don't want to pay discount points for the rate. require 6 months liquid reserves for each property that you own. Its super regulated. Inventory is the real issue, builders can't keep up with the demand. They really don't want to keep up with demand because it will then drive down the price of the properties they are building in the future. Last local regulation on new builders is out of control. I work with a builder out of Hammond the cost has gone up 30% for land in the last 4 years due to local regulations on lot size, home size, and the permit and zoning requirements. Local govt's stuffing their pockets don't help and we all know Louisiana is full of this.
Posted on 5/20/24 at 1:39 pm to TigerDoug
quote:
I personally know a builder who I have done business with in the past has two subdivisions he is doing as BTR - Build to rent - all single family homes.
So they are adding supply? Good for them
Posted on 5/20/24 at 1:42 pm to hawkeye007
quote:
loans for investment properties are the highest rate on any type of mortgage require a min 20% down 30% down
Locally theyre paying cash, well over asking price.
There are enough of them to frick up the housing market for residentials.
Posted on 5/20/24 at 1:43 pm to RogerTheShrubber
quote:I mean, perhaps in your hyper-local market. But there is a PHYSICAL lack of supply (not a financial one). The number you usually see is 3-4 million units. Being conservative, I think it's at least 1.7 -2 million.
There has been plenty of new construction.
Its being sold to corporations.
This has nothing to do with corporations.
Posted on 5/20/24 at 1:44 pm to RogerTheShrubber
quote:
Locally theyre paying cash, well over asking price.
There are enough of them to frick up the housing market for residentials.
With the draw here being what, you think?
Posted on 5/20/24 at 1:44 pm to deeprig9
quote:Both of these examples perfectly demonstrate the negative impact that NIMBYism has on supply.
Examples-
Athens zoned their Five Points neighborhood with a rule that no more than two unrelated people can occupy a single family residence. Of course people sued, but the county won. This was in response to the growing student population creeping into the nice neighborhoods and the old school blue hairs didn't want them.
The city of Mt Pleasant SC commission made a rule that growth would be capped at 5% a year for new building permits when the area started to explode. It protected that jurisdiction during the 2008 housing crisis. None of those people lost a dime in equity because they hadn't overbuilt.
Posted on 5/20/24 at 1:46 pm to RogerTheShrubber
quote:It just isn't. Presently - in addition to inadequate supply - probably the biggest contributor to prices is ultra-low interest rate mortgages whereby people simply are not going to sell their home, almost no matter what.
Thats exactly whats causing residential real estate to explode.
Posted on 5/20/24 at 1:47 pm to RogerTheShrubber
same here in baton rouge, when they announced the new amazon location a few years back 35% of the real estate in zip codes near the location were bought for cash by invest firms. The only small investors buying rental properties are doing 301 exchanges because they sold an investment properties. rental numbers don't work when the interest rate is 8%
Posted on 5/20/24 at 1:48 pm to RogerTheShrubber
quote:No, I'm not. It's a frequent bullet in the list of what Biden has screwed up. It's always political. When it was Obama, then market prices going up was a "sugar high" and "funny money". Then, when it was Trump (who actually yelled at the Fed for even talking about raising rates) it was all good. Now that it's Biden, it's back to being "he screwed up by having rates go up".
They've been artificially low forever.
I think youre getting your boards confused.
Posted on 5/20/24 at 1:52 pm to Big Scrub TX
quote:
There's CONSTANT bitching on here about interest rates being higher.
Youre confusing inflation and interest.
Inflation can be blamed on Trump and Joe. Interest is out of their hands.
Youre very confused.
This post was edited on 5/20/24 at 1:54 pm
Posted on 5/20/24 at 1:54 pm to MadQfrog
No way they are changing things. They want people in perpetual serfdom. Next step is "helping the people" with 15 minute cities, with everyone crammed on top of each other.
Posted on 5/20/24 at 1:56 pm to HoopsAurora
quote:
They want people in perpetual serfdom.
Thats not whats fueling the investor side, though it might be in the minds of planners.
Investors are just reacting to the wealth created by the govt printing money. They have the cash, they know govt will prop up their investments.
Its the first time, young home buyers getting fricked.
Posted on 5/20/24 at 1:57 pm to RogerTheShrubber
Inflation and interest have correlation, you know.
Posted on 5/20/24 at 1:59 pm to RogerTheShrubber
Parrot gonna parrot….until the next affordable housing project is proposed next door.
Posted on 5/20/24 at 2:03 pm to VOR
quote:This is no different than the late 80s panic over Japanese investors buying up all of the US. Glad the government didn't intervene.
t’s bad for the market long term.for investors to gobble up housing stock.
Posted on 5/20/24 at 2:05 pm to TigerDoug
quote:So, 250 homes prove something about supply in an MSA with 2 million + people?
I can only speak to the KC market but this is a true statement.
I personally know a builder who I have done business with in the past has two subdivisions he is doing as BTR - Build to rent - all single family homes.
1st one - 75 homes - 4 or 5 bed, 2.5 baths, 2 car garage
2nd one - 173 homes - 3 or 4 bedroom, 2 car garage.
quote:Amherst is not a hedge fund.
The hedge funds are eating these up. I know Main Street Renewal ( Amherst Holdings )
Posted on 5/20/24 at 2:07 pm to RogerTheShrubber
quote:No, I'm not. I have perfectly described exactly what I meant to describe. Stout alone starts nearly infinite threads on 7% mortgage rates.
Youre confusing inflation and interest.
Inflation can be blamed on Trump and Joe. Interest is out of their hands.
Youre very confused.
Posted on 5/20/24 at 2:09 pm to MadQfrog
The government will always be involved in most every aspect of our life. More importantly they will always complicate things and make life more expensive and miserable. Governmental influence is one of the four factors which affect value related to real estate.
For the past two decades, investors were often permitted to obtain financing for single family residential properties with the same terms and conditions (30 year amortization with a 30 year fixed interest rate) as individuals. If the investor buying a single family dwelling were forced to obtain mortgage financing terms from a 'non-conventional loan' perspective they would seek an alternative investment. Simply put, their loan terms would be similar to another investor which is purchasing a machine shop or office building (20 year amortization with 5 year fixed interest rate).
For the past two decades, investors were often permitted to obtain financing for single family residential properties with the same terms and conditions (30 year amortization with a 30 year fixed interest rate) as individuals. If the investor buying a single family dwelling were forced to obtain mortgage financing terms from a 'non-conventional loan' perspective they would seek an alternative investment. Simply put, their loan terms would be similar to another investor which is purchasing a machine shop or office building (20 year amortization with 5 year fixed interest rate).
This post was edited on 5/20/24 at 2:21 pm
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