4 ms·

This is no different than what a lot of flippers and small time real estate investors do by buying up numerous condos, duplexes, etc., in an upcoming neighborho

This is no different than what a lot of flippers and small time real estate investors do by buying up numerous condos, duplexes, etc., in an upcoming neighborhood, throwing on a fresh coat of paint and some fake granite counters, and renting for 50% more than the month before. Instead of VC money, they're leveraging low interest funny money created by banks and de-facto guaranteed now by the feds. I really don't think the VCs nor the banks care, as long as the rental and AirBNB money keeps flowing, allowing return of principle and even eventual profits. They could care less that it is adding to the unaffordability of homes for everyone else.

thaumasiotes 8y ago
It is different in that the ownership of the capital changes. Going in it belongs to the company; coming out it belongs to the founder personally. If I buy an apartment under my own name, renovate it, and then rent it out under my own name, that's a pretty normal business. If I work for a company that rents an apartment, and I, knowing the company isn't using it, personally rent that apartment out in exchange for payments directly to me, that is, more or less, embezzlement. I don't have the legal right to sell or rent the company's property to you.