6 ms·

Yes, the investors are the symptom and not the cause. They are going where the money leads them. However a big problem with institutional investors is that th

by slg 4y ago

Yes, the investors are the symptom and not the cause. They are going where the money leads them. However a big problem with institutional investors is that they also institutionalize NIMBYism. They won't just block housing in a select neighborhood, they will block housing everywhere and they put more pressure on the federal government to ensure that housing is protected as an investment class. Both will contribute to worsening the issue. Plus even at low levels NIMBYism is often about investment. Sure, many object to new housing for reasons like "it will change the character of the neighborhood". But many others object because they are worried about the value of their own home going down. They are treating their home primarily as an investment because that is what they have been told to do their whole life. If I could snap my fingers and magically realign our political goals to maintaining stable home values instead of having them ever-increasing, many NIMBY objections would fade away.

davidw 4y ago
Investors do not at all have the votes or weight at a local city level in most cases, especially large ones from out of town. Go to a planning meeting about some housing that people are pissed off about because reasons ( https://news.ycombinator.com/item?id=32569768 https://news.ycombinator.com/item?id=32569768 ) and you'll find a whole bunch of your neighbors. It's not institutional investors blocking this stuff, by and large. > they are worried about the value of their own home going down. They are treating their home primarily as an investment because that is what they have been told to do their whole lives Yes, that's much closer to what I've observed in person fighting these fights.
- koolba 4y ago
  How would they vote at all? I’m not aware of any local council that grants votes based upon tax dollars paid or acreage. It’s one person one vote for actual residents. Now lobby dollars are another story. But renters can fix that by actually voting.
  - lostapathy 4y ago
    They can run/fund NIMBY groups that encourage people to vote their way. Local to me, we've had a few causes pop up with surprisingly well-run NIMBY efforts opposing them in recent years. The amount of money raised and the signs and slogans are way too good to be the product of the actual locals who speak out on behalf of these groups - somebody else is clearly funding them and doing some marketing.
  - mhuffman 4y ago
    >How would they vote at all? I’m not aware of any local council that grants votes based upon tax dollars paid or acreage. It’s one person one vote for actual residents. I don't know of any local councils that grant local votes to anyone -- they vote themselves. This should spark an idea of how rich people's dollars outweigh poor people's input. They only have to convince half of the council to vote one way. This can be done through wining and dining, sending "experts" to make presentations, making promises, and so on.
- slg 4y ago
  >Investors do not at all have the votes or weight at a local city level in most cases, especially large ones from out of town. Yes, the institutional investors aren't going to be in your local council meeting. They will be meeting with your state assembly members. They will be meeting with your Congresspeople. They won't be literal NIMBYs focusing on anyone's "backyard". However they will be working towards the same goals at NIMBYs, just at a larger scale.
  - giantg2 4y ago
    Likely under the guise of safety, environment, etc like building codes and conservation zoning.
    - throwaway0a5e 4y ago
      >safety, environment, It's amazing the power those subjects have to turn "YIMBY" into "regulate me harder daddy". The cognitive dissonance required to enable this about face is a bad thing and seems to be becoming more and more prevalent and accepted in all sorts of public policy contexts.
      - giantg2 4y ago
        It's because it's "regulate my neighbor" and it doesn't currently apply to them, until they need to remodel or whatever years down the road. Most people don't realize the full impact of the legislation they support.
- asdff 4y ago
  Of course they do, they can just buy advertising to convince locals to vote against their own interests. Works quite well. See uber and Prop 22.
  - deleted 4y ago
    [deleted]
giantg2 4y ago
"Sure, many object to new housing for reasons like "it will change the character of the neighborhood". But many others object because they are worried about the value of their own home going down." At least in my area, it's all about people wanting the area to remain semi-rural. They generally aren't opposing low density SFH in independent builds. The people in my area are against many development and medium density homes.
- alexb_ 4y ago
  A lot of what I've seen is people worried about "low quality tenants" (read: people who don't look just like me)
  - giantg2 4y ago
    I think that's less of a concern right near me. This is basically farm land or woods being turned into medium and low density developments. I think that comes into play with cheaper or higher density housing (either the legitimate low quality or the racist low quality version).
  - mikestew 4y ago
    The two tenants within a few houses of us in either direction would fit my definition (and likely that of many other folks) of "low quality tenant": don't bother picking up the beer can out of their yard, don't mow (at all), loud-ass exhaust on their shitty cars, etc. More of an eyesore than a contribution to the local community, and causing me to realize why HOAs come about. But, yeah, it's all because they have brown skin. Oh, wait, the tenants in question are whiter than I am.
    - alexb_ 4y ago
      "Eyesores" need a place to live too. And I said "look like me" for a reason: class is a bigger part of this than anything else.
      - mikestew 4y ago
missedthecue 4y ago
"They are treating their home primarily as an investment because that is what they have been told to do their whole life." It's not some psyop that has duped an entire nation, it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater.
- slg 4y ago
  > it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater. What is those people's second biggest purchase which is also usually done with debt? Does anyone believe that the government should enact policies to ensure that car prices always increase so they would be a better investment? Houses obviously have a longer lifespan than cars, so I'm not suggesting they should necessarily depreciate the same way, but there is also no reason housing should always be appreciating. We have this idea that the price you sell your home for should always be higher than the price you bought it for. There is no reason for us to preserve that idea beyond the fact that people have now internalized that idea and plan their financial lives around it. The longer we allow that to continue, the harder it becomes to change, but the idea itself is not some fundamental requirement of society.
  - davidw 4y ago
    The goal should probably be something close to price stability. If prices bounce all around, up and down, people pay more attention than if they were just kind of 'there', and you could buy or sell whenever the need arose in order to move into housing that better suits you at a given point in your life.
    - slg 4y ago
      Exactly. True stability is likely unattainable, but I would love if it was a governmental goal like a steady small positive rate of inflation is a goal. There will be temporary changes like the last year with inflation. But for the prior 30 years there has been a very steady roughly 2-4% rate of inflation. Could you imagine if the federal, state, and local government fully committed to steadying housing costs? It would be amazing. It just seems politically impossible to get to there from here because of the people who would be hurt by that transition.
trhway 4y ago
>Yes, the investors are the symptom and not the cause. absolutely. If anything investors provide for liquidity of the market. The real issue is that investors, ie. the rich, are getting more and more ability to buy real estate while the middle and the low class are getting less and less capable of doing so. The reason is the huge sloshing amounts of money being given to the top, and thus those money causing a strong push for the price rise of the assets (back at the beginning of pandemic i said that it will result in the biggest redistribution of wealth https://news.ycombinator.com/item?id=23924777 https://news.ycombinator.com/item?id=23924777 toward the rich and large ones)
- larkost 4y ago
  > absolutely. If anything investors provide for liquidity of the market. No, no, no. "providing liquidity" is not a good thing unless liquidity is actually a problem almost everywhere people talk about this. The "liquidity" provided by high-frequency traders in the stock market does not benefit anyone but themselves. For everyone else the difference between trading in minutes and hours (or even days) is near-meaningless. And they don't provide liquidity for seldom traded stocks. And on the housing market they are not providing liquidity for the market in general. They are buying and then renting those properties out. Since they are all-cash offers they often trump "regular" buyers out of the market, even when offering the same price. Again, the only ones who benefit by this are those investors themselves. These investors are one of the major forces pushing up the prices, the are part of the problem, not the solution.
  - throwaway_4ever 4y ago
    Liquidity is a huge problem in real estate. Right now, every single person forfeits 5-6% of their home value every time they exchange homes. That's $20k on average. Reducing the spread on homes by providing liquidity would be a huge financial boon to all classes except realtors.
    - notch656a 4y ago
      Is that true if you sell your home yourself? I've never bought a home, but I know I can transfer a title to a vehicle without forfeiting anything beyond the sales tax and the $50 title fee. Is there no way to sell/buy real estate directly like that using cash transactions direct between parties?
jrumbut 4y ago
It seems so clear that the way forward is not to try to convince people to sacrifice the foundation of their financial security but is rather to compensate them. Make it so neighbors are competing to host whatever they are NIMBYing about currently because it comes with a package of goodies that will offset the problems. It doesn't have to include much new spending, rebalancing or reprioritization of existing resources to ensure fairness can be part of it. Is this the norm? I feel like I haven't heard it often during debates over unpopular new developments.

by slg 4y ago

davidw 4y ago

Investors do not at all have the votes or weight at a local city level in most cases, especially large ones from out of town. Go to a planning meeting about some housing that people are pissed off about because reasons ( https://news.ycombinator.com/item?id=32569768 https://news.ycombinator.com/item?id=32569768 ) and you'll find a whole bunch of your neighbors. It's not institutional investors blocking this stuff, by and large. > they are worried about the value of their own home going down. They are treating their home primarily as an investment because that is what they have been told to do their whole lives Yes, that's much closer to what I've observed in person fighting these fights.

koolba 4y ago
How would they vote at all? I’m not aware of any local council that grants votes based upon tax dollars paid or acreage. It’s one person one vote for actual residents. Now lobby dollars are another story. But renters can fix that by actually voting.
- lostapathy 4y ago
  They can run/fund NIMBY groups that encourage people to vote their way. Local to me, we've had a few causes pop up with surprisingly well-run NIMBY efforts opposing them in recent years. The amount of money raised and the signs and slogans are way too good to be the product of the actual locals who speak out on behalf of these groups - somebody else is clearly funding them and doing some marketing.
- mhuffman 4y ago
  >How would they vote at all? I’m not aware of any local council that grants votes based upon tax dollars paid or acreage. It’s one person one vote for actual residents. I don't know of any local councils that grant local votes to anyone -- they vote themselves. This should spark an idea of how rich people's dollars outweigh poor people's input. They only have to convince half of the council to vote one way. This can be done through wining and dining, sending "experts" to make presentations, making promises, and so on.
slg 4y ago
>Investors do not at all have the votes or weight at a local city level in most cases, especially large ones from out of town. Yes, the institutional investors aren't going to be in your local council meeting. They will be meeting with your state assembly members. They will be meeting with your Congresspeople. They won't be literal NIMBYs focusing on anyone's "backyard". However they will be working towards the same goals at NIMBYs, just at a larger scale.
- giantg2 4y ago
  Likely under the guise of safety, environment, etc like building codes and conservation zoning.
  - throwaway0a5e 4y ago
    >safety, environment, It's amazing the power those subjects have to turn "YIMBY" into "regulate me harder daddy". The cognitive dissonance required to enable this about face is a bad thing and seems to be becoming more and more prevalent and accepted in all sorts of public policy contexts.
    - giantg2 4y ago
      It's because it's "regulate my neighbor" and it doesn't currently apply to them, until they need to remodel or whatever years down the road. Most people don't realize the full impact of the legislation they support.
asdff 4y ago
Of course they do, they can just buy advertising to convince locals to vote against their own interests. Works quite well. See uber and Prop 22.
- deleted 4y ago
  [deleted]

giantg2 4y ago

"Sure, many object to new housing for reasons like "it will change the character of the neighborhood". But many others object because they are worried about the value of their own home going down." At least in my area, it's all about people wanting the area to remain semi-rural. They generally aren't opposing low density SFH in independent builds. The people in my area are against many development and medium density homes.

alexb_ 4y ago
A lot of what I've seen is people worried about "low quality tenants" (read: people who don't look just like me)
- giantg2 4y ago
  I think that's less of a concern right near me. This is basically farm land or woods being turned into medium and low density developments. I think that comes into play with cheaper or higher density housing (either the legitimate low quality or the racist low quality version).
- mikestew 4y ago
  The two tenants within a few houses of us in either direction would fit my definition (and likely that of many other folks) of "low quality tenant": don't bother picking up the beer can out of their yard, don't mow (at all), loud-ass exhaust on their shitty cars, etc. More of an eyesore than a contribution to the local community, and causing me to realize why HOAs come about. But, yeah, it's all because they have brown skin. Oh, wait, the tenants in question are whiter than I am.
  - alexb_ 4y ago
    "Eyesores" need a place to live too. And I said "look like me" for a reason: class is a bigger part of this than anything else.
    - mikestew 4y ago

missedthecue 4y ago

"They are treating their home primarily as an investment because that is what they have been told to do their whole life." It's not some psyop that has duped an entire nation, it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater.

slg 4y ago
> it's people accurately recognizing that their home is the biggest purchase they will ever make in their life, it's almost completely done with debt, and most don't want to end up underwater. What is those people's second biggest purchase which is also usually done with debt? Does anyone believe that the government should enact policies to ensure that car prices always increase so they would be a better investment? Houses obviously have a longer lifespan than cars, so I'm not suggesting they should necessarily depreciate the same way, but there is also no reason housing should always be appreciating. We have this idea that the price you sell your home for should always be higher than the price you bought it for. There is no reason for us to preserve that idea beyond the fact that people have now internalized that idea and plan their financial lives around it. The longer we allow that to continue, the harder it becomes to change, but the idea itself is not some fundamental requirement of society.
- davidw 4y ago
  The goal should probably be something close to price stability. If prices bounce all around, up and down, people pay more attention than if they were just kind of 'there', and you could buy or sell whenever the need arose in order to move into housing that better suits you at a given point in your life.
  - slg 4y ago
    Exactly. True stability is likely unattainable, but I would love if it was a governmental goal like a steady small positive rate of inflation is a goal. There will be temporary changes like the last year with inflation. But for the prior 30 years there has been a very steady roughly 2-4% rate of inflation. Could you imagine if the federal, state, and local government fully committed to steadying housing costs? It would be amazing. It just seems politically impossible to get to there from here because of the people who would be hurt by that transition.

trhway 4y ago

>Yes, the investors are the symptom and not the cause. absolutely. If anything investors provide for liquidity of the market. The real issue is that investors, ie. the rich, are getting more and more ability to buy real estate while the middle and the low class are getting less and less capable of doing so. The reason is the huge sloshing amounts of money being given to the top, and thus those money causing a strong push for the price rise of the assets (back at the beginning of pandemic i said that it will result in the biggest redistribution of wealth https://news.ycombinator.com/item?id=23924777 https://news.ycombinator.com/item?id=23924777 toward the rich and large ones)

larkost 4y ago
> absolutely. If anything investors provide for liquidity of the market. No, no, no. "providing liquidity" is not a good thing unless liquidity is actually a problem almost everywhere people talk about this. The "liquidity" provided by high-frequency traders in the stock market does not benefit anyone but themselves. For everyone else the difference between trading in minutes and hours (or even days) is near-meaningless. And they don't provide liquidity for seldom traded stocks. And on the housing market they are not providing liquidity for the market in general. They are buying and then renting those properties out. Since they are all-cash offers they often trump "regular" buyers out of the market, even when offering the same price. Again, the only ones who benefit by this are those investors themselves. These investors are one of the major forces pushing up the prices, the are part of the problem, not the solution.
- throwaway_4ever 4y ago
  Liquidity is a huge problem in real estate. Right now, every single person forfeits 5-6% of their home value every time they exchange homes. That's $20k on average. Reducing the spread on homes by providing liquidity would be a huge financial boon to all classes except realtors.
  - notch656a 4y ago
    Is that true if you sell your home yourself? I've never bought a home, but I know I can transfer a title to a vehicle without forfeiting anything beyond the sales tax and the $50 title fee. Is there no way to sell/buy real estate directly like that using cash transactions direct between parties?

jrumbut 4y ago

It seems so clear that the way forward is not to try to convince people to sacrifice the foundation of their financial security but is rather to compensate them. Make it so neighbors are competing to host whatever they are NIMBYing about currently because it comes with a package of goodies that will offset the problems. It doesn't have to include much new spending, rebalancing or reprioritization of existing resources to ensure fairness can be part of it. Is this the norm? I feel like I haven't heard it often during debates over unpopular new developments.