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New Legislation Proposes to Take Wall Street Out of the Housing Market (www.nytimes.com)
submitted 2 years ago by to c/news@lemmy.world
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[–] 18 points 2 years ago (3 children)

Wall Street is not the problem, a lack of new housing is, according to David Howard, the chief executive of the National Rental Home Council, a trade association. The country needs anywhere from 2 million to 6.5 million units of new housing, according to various estimates.

“Policies really need to be shaped and crafted so that they support the production, investment and development of new housing,” Mr. Howard said. “I think bills that work against that ultimately are just going to perpetuate the challenges we’re already facing.”

While I certainly disagree with this person on some of their specifics, and don't necessarily agree with the "teeth" of this bill (10k per home owned isn't that much in the grand scheme of things, and can just be priced in to an already out-of-control market), seeing a trade organization argue for the actual long-term solution bodes really well for the future of solving the housing crisis.

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  • [–] 24 points 2 years ago (2 children)

    That's crazy that they say we need more housing when there are so many empty houses sitting on the market from corporate real estate investing and other house flippers. "Wall Street is not the problem, a lack of new housing is" really sounds like the guy with gasoline and matches in hand saying "it wasn't me" at the scene of an arson fire.

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  • [–] 12 points 2 years ago* (2 children)

    A significant problem isn't just the lack of housing, it's the lack of affordable housing. Builders keep building single family homes in spread out suburbs which is problematic in its own way. But not everyone could afford those homes regardless of whether they are buying or renting.

    Investors owning single family homes is a big problem, the bigger problem is exacerbated but not explicitly caused by that. Affordable housing simply isn't available in places where it's needed. That's why people say we need more homes.

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  • [–] 9 points 2 years ago

    Not just single family homes. They could be building starter single family homes, but those are cheap. They could be focusing on middle class family single family homes, but those aren't as profitable as the luxury housing. They focus on luxury housing both in single family suburbs, and when they build apartment buildings in the cities.

    According to the home builders, if you aren't rich, they won't build you a home.

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  • [–] 4 points 2 years ago (2 children)

    The funny thing about empty yet "unaffordable" housing is that if the market actually works correctly it gets lowered in price until a buyer is found.

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  • [–] 1 point 2 years ago (1 child)

    You would think so. But the reality is that large companies would often rather let a property sit empty than devalue it by accepting a lower amount. And when they control enough of the market that there's no good competition, it breaks the whole "free market" thing.

    You or I would be hurting (I presume) if we owned a property and weren't living in and weren't making any money off of it. These holding companies just see a line on a spreadsheet under the "assets" column.

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  • [–] 9 points 2 years ago* (2 children)

    A lack of housing is very explicitly our problem. Houses that are empty are not unowned.

    Until housing is no longer seen as an investment, which can only happen if we are allowed to build sufficient housing, housing will continue to go up in value, and thus more people will invest

    Anyone who sees their home as their "nest egg" is part of the problem.

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  • [–] 6 points 2 years ago* (1 child)

    So you build 500,000 new homes and blackstone or other companies buy 450,000, meaning you only actually generated 50,000 new homes. No, corporate interests are the vast majority of the problem with housing. Your neighbor renting out their house after buying a 2nd isn't the issue.

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  • [–] -3 points 2 years ago (1 child)

    Assuming some large capital group buys all those homes, they're going to do it to try to make money off of it.

    More supply means lower prices

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  • [–] 3 points 2 years ago (1 child)

    Constraining supply, either by not building, or by buying everything available, means higher prices, so they don't have to sell as many houses to make the same revenue.

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  • [–] 5 points 2 years ago (1 child)

    Until housing is no longer seen as an investment, which can only happen if we are allowed to build sufficient housing

    It can happen through legislation.

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  • [–] 14 points 2 years ago (1 child)

    The head of an organization that represents landlords is advocating for building more houses. Now why do you think that is?

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  • [–] 4 points 2 years ago* (1 child)

    Because they want to build more to make more money.

    Please explain how this is a bad thing? This is rental org explicitly stating that the lack of supply is hurting their growth and profit.

    That means they believe that the supply/demand curve is so out of whack that cheaper housing will make them more money.

    This is absolutely and 100% a win-win.

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  • [–] 0 points 2 years ago (1 child)

    Because I believe, in general, landlords are a bad thing.

    This guy is getting priced out of the market by big money hedge funds the same way he prices out families looking to buy their single homes. Making housing "affordable" by increasing the supply of new houses disproportionately benefits the wealthy. After all, if you have $100 million you want to spend on property ownership, would you rather buy one hundred $1 million properties, or one thousand $100,000 properties of the same size?

    You want to make housing affordable? Stop letting parasites like these buy dozens of houses.

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  • [–] 3 points 2 years ago* (1 child)

    Making housing "affordable" by increasing the supply of new houses disproportionately benefits the wealthy.

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  • [–] -1 points 2 years ago (2 children)

    Some people need to imagine how they can get cheap thingies while the people who they bought from still make a profit. Does this matter? With cheap houses they will have many children which will push for more houses until either the earth becomes just houses or their demands are squashed and they become sardines.

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  • [–] 9 points 2 years ago (1 child)

    The trade organization is arguing for investment into their market rather than regulations that would improve the efficiency of their market. The bill is likely a negative for them, and they want something that would be a positive.

    The situation is not caused by a lack of number of houses. It's caused by the lack of efficiency in housing. It's more beneficial to leave units empty than to fill them because there's little penelty (and sometime incentives) to do so. There should be something like a land value tax that pushes for more efficient use of land, not investments that push for less efficient use.

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  • [–] -4 points 2 years ago*

    The trade organization is arguing for investment into their marke

    This is the only solution to the housing crisis. We have too little housing. We need more.

    The situation is not caused by a lack of number of houses

    This is not supported by math.

    There should be something like a land value tax that pushes for more efficient use of land

    Stop, stop - I can only get so erect! I'd absolutely love to see more of a push for LVTs, but we both know that's our fantasy and not a serious discussion in the near term.

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