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> And obviously, on average, we’re blasting way past anything seen in 2005-2008. Perhaps, but what's different this time is: 1) There are more institutional b
by chiefalchemist 5y ago
> And obviously, on average, we’re blasting way past anything seen in 2005-2008.
Perhaps, but what's different this time is:
1) There are more institutional buyers. 15 yrs ago, I would presume, less than today.
2) Mind you Zillow wasn't prepared, but others certainty are.
3) With that said, I'd imagine instutional buyer are drolling for an implosion. The small fish would have to bail and the big fish are there waiting to snatch up all they can
Last time it was negligence. The fact it's repeating so soon makes it feel far more intentional.
- theincredulousk 5y agoWell that is exactly what happened last time it imploded - private equity sitting on loads of cash waiting for an opportunity got one. They were buying houses like they came in 24-packs from Costco. I'm not sure what the "split" among institutional investors is, but afaik most of them want the houses to rent them and create a revenue stream, not flip them for a one-time profit. So inflation doesn't really help them either; e.g. it means they pay more taxes, and requires more upfront capital for the same revenue stream unless the rent they can charge increases in lock-step % (which maybe it does). The fact that the underlying asset appreciates in value is more than just gravy, but don't think it's the point for them. I think they are doing it because it is almost an obvious investment from a risk-return profile compared to other options.