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re: WSJ: Wall Street Has Spent Billions Buying Homes. A Crackdown Is Looming.
Posted on 4/29/24 at 11:15 am to CatfishJohn
Posted on 4/29/24 at 11:15 am to CatfishJohn
quote:
You're making a strawman. It literally stops at freestanding single family homes.
Except it starts there. That’s what you don’t understand. DR Horton’s of the world develop raw land, build a home, own that home, and then…sell it.
Are you saying you can’t develop a home?
Or you are saying you can’t buy an already built home?
What if no one else wants to buy it? Can they bid? After 120 days? What if it’s a foreclosure and no one wants to buy it?
You guys are upset because you assume an institution is out there out bidding people that then have to go rent. It’s not like that at all.
2
Posted on 4/29/24 at 11:25 am to baldona
quote:
You guys are upset because you assume an institution is out there out bidding people that then have to go rent. It’s not like that at all.
What do you think happens to a development/local market if a firm buys up 50 of the 100 houses that DR Horton or DSLD are building?
Posted on 4/29/24 at 11:26 am to baldona
quote:
You guys are upset because you assume an institution is out there out bidding people that then have to go rent. It’s not like that at all.
I know of 3 different occasions near me where people I knew (or friends of friends) were out bid by institutional buyers. This isn't a problem invented on the OT. It is a known issue nationally in the housing market and it needs regulation.
quote:
Are you saying you can’t develop a home?
Nope, that is different. You are adding to the supply, not buying up pre-existing supply.
quote:
Or you are saying you can’t buy an already built home?
If you're an institutional buyer that has hit (a yet to be determined) limit of owned single family freestanding homes, yes, I am saying that.
quote:
What if no one else wants to buy it?
Tough. Re-price it or sit on it. This is exactly the situation where institutional investors salivate. They don't care about near term losses in equity value so they buy an overpriced home, which we know is overpriced due to it not selling, and sit on it. They do this is swaths. That artificially inflates home values.
You're making it more complicated than it has to be.
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