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Consumer debt is also low; https://fred.stlouisfed.org/series/CDSP https://fred.stlouisfed.org/series/CDSP And metrics like credit card delinquencies are at hi

Consumer debt is also low; https://fred.stlouisfed.org/series/CDSP https://fred.stlouisfed.org/series/CDSP And metrics like credit card delinquencies are at historic lows: https://fred.stlouisfed.org/series/DRCCLACBS https://fred.stlouisfed.org/series/DRCCLACBS ARMs actually aren't very popular - fewer than 15% of new mortgages are ARM. > BlackRock bought what, 10-15% of the houses sold in 2020? People vastly overestimate how large players like Blackrock are. There are something like 80 million single-family homes in the US. Of these, Blackrock owns 80 thousand. If they bought every one of those homes in 2020 (they didn't) - it would represent more like 1% of homes sold that year. And of course there are millions of condos not figured into my denominator. They're huge, but way under 1% of purchases.

alphabettsy 5y ago
Naïve question, but what happens if something like 5-10% of those ARMs default and the traditional default rate increases too?
ameister14 5y ago
Of the 80 million single family homes in the US, how many are sold each year? For your math to work (80,000 as 1%) it would have to be 8,000,000 or 10% of the overall supply. I can actually answer for you - roughly 820,000 single family homes were sold in 2020. So if BlackRock bought 80,000 homes then, that'd be about 10%.
- mikeyouse 5y ago
  You're conflating some figures -- 820k new homes were sold[1] -- along with roughly 5.6 million existing homes[2]. [1] - https://www.housingwire.com/articles/new-home-sales-historically-high-in-2020/ https://www.housingwire.com/articles/new-home-sales-historic... [2] - https://cdn.nar.realtor/sites/default/files/documents/ehs-01-2022-breakouts-of-single-family-condo-and-co-op-2022-02-18.pdf https://cdn.nar.realtor/sites/default/files/documents/ehs-01...
  - ameister14 5y ago
    ah, you're right, it was 5 million existing single family, I was pulling from the census and misread. My mistake.
analyte123 5y ago
Good point but it works against your overall argument - the investors who buy 10-20% of houses are far less sophisticated than Blackrock and far more likely to start panic selling when their Airbnb income can’t pay their bills.

alphabettsy 5y ago

Naïve question, but what happens if something like 5-10% of those ARMs default and the traditional default rate increases too?

ameister14 5y ago

Of the 80 million single family homes in the US, how many are sold each year? For your math to work (80,000 as 1%) it would have to be 8,000,000 or 10% of the overall supply. I can actually answer for you - roughly 820,000 single family homes were sold in 2020. So if BlackRock bought 80,000 homes then, that'd be about 10%.

mikeyouse 5y ago
You're conflating some figures -- 820k new homes were sold[1] -- along with roughly 5.6 million existing homes[2]. [1] - https://www.housingwire.com/articles/new-home-sales-historically-high-in-2020/ https://www.housingwire.com/articles/new-home-sales-historic... [2] - https://cdn.nar.realtor/sites/default/files/documents/ehs-01-2022-breakouts-of-single-family-condo-and-co-op-2022-02-18.pdf https://cdn.nar.realtor/sites/default/files/documents/ehs-01...
- ameister14 5y ago
  ah, you're right, it was 5 million existing single family, I was pulling from the census and misread. My mistake.

analyte123 5y ago

Good point but it works against your overall argument - the investors who buy 10-20% of houses are far less sophisticated than Blackrock and far more likely to start panic selling when their Airbnb income can’t pay their bills.