3 ms·

I'd love someone in one of the "strategy" arms in one of these funds to explain what they think the end result of this is at it's extent? Do they believe that

I'd love someone in one of the "strategy" arms in one of these funds to explain what they think the end result of this is at it's extent? Do they believe that eventually these will be sold back to single families to build equity? Do they think that, the primary asset which has driven middle class wealth growth for ~100 years is now perfect for liquidating into - what? Is the goal to make everyone a renter forever?

USB5 3y ago
Karl Marx answered all of these questions back in the 20th century.
- pram 3y ago
  19th century my guy
- AndrewKemendo 3y ago
  I'm more of a Proudhon guy myself
- option 3y ago
  worked fabulously for those who took his answers to heart!
  - readthenotes1 3y ago
    Like Pol Pot who only seemed to have read the manifesto?
    - option 3y ago
      many others who had read more than that but with similar results
iscrewyou 3y ago
I think it's the last one. It's the ultimate subscription.
- bombcar 3y ago
  Single family homes are about the worst thing you can rent out if you're not counting on appreciation.
  - breckenedge 3y ago
    Eh it’s a depreciating asset, which you can write off over 27.5 years. There are plenty of advantages for owning SFR as an investment. And this article was written when rates were still stupidly low.
  - t-writescode 3y ago
    "if you're not counting appreciation" is doing a whole lot of legwork in this sentence.
    - bombcar 3y ago
      It's doing all the legwork - SFRs are negative cash flow, and the only reason to hold negative cash flow properties at the absolutely horrendous cap rates they have is because of appreciation. But appreciation cannot go on forever or each property will be infinitely expensive and nobody will be able to afford them. It is a dance that will end at some point.
      - t-writescode 3y ago
        Australia is a fantastic image of what happens in that process, and they don't show much sign of slowing, being even worse than the States' issues.
        bombcar 3y ago
        It can certainly go a lot longer than people will expect, and it will have weird side-effects (California also gives some hints, what with huge appreciation and prop 13). The biggest hurdle now is the jump from renter (or living with parents) to homeowner; there used to be "starter homes" that could get you on the treadmill but even those are quite high. Once you're on the treadmill it's not that bad as house prices in an area tend to be in lockstep, but that first step can be a big one.
rodgerd 3y ago
Restore serfdom.
VintageCool 3y ago
My guess is that houses are an inflation-resistant asset. It's a good place to dump money if you have too much. And the downside is limited by political inertia: most voters own homes and would suffer if their house lost value, so the American political system will sacrifice much to prevent housing prices from going down too much.
oilchange 3y ago
> I'd love someone in one of the "strategy" arms in one of these funds to explain what they think the end result of this is at it's extent? You buy homes in a region if you think the population will rise, interest rates will be relatively low, job prospects will be stable, etc which will lead to increasing home values. Whether they want to profit by flipping the homes or by renting them, I don't know. But it's a bullish bet on texas home prices by people who could politically influence human migration policy ( both domestic and foreign ), fed policy/interest rates and even jobs/economy. Meaning they can place the bet and pull the strings to make the bet pay off.
thisisit 3y ago
This is about cashflow. Consistent cashflow at that. To achieve that everything needs some sort of subscription model. Rent is the subscription model for housing. These consistent cashflows then can be bundled into some sort of financial products and sold to investors -- something similar to the financial products during the 2008 crash. Just that now instead of interest payments which might crash, rents can be stabilized. Even if things go wrong equity is still protected due to the house.
HDThoreaun 3y ago
1. Find a place with a growing population and restrictive zoning 2. Corner the housing market 3. The population keeps growing but the restrictive zoning means more housing doesn't get built 4. More people competing for the same housing stock means prices increase Whether they keep the housing forever or not isn't what they're thinking about, they can decide later.

USB5 3y ago

Karl Marx answered all of these questions back in the 20th century.

pram 3y ago
19th century my guy
AndrewKemendo 3y ago
I'm more of a Proudhon guy myself
option 3y ago
worked fabulously for those who took his answers to heart!
- readthenotes1 3y ago
  Like Pol Pot who only seemed to have read the manifesto?
  - option 3y ago
    many others who had read more than that but with similar results

iscrewyou 3y ago

I think it's the last one. It's the ultimate subscription.

bombcar 3y ago
Single family homes are about the worst thing you can rent out if you're not counting on appreciation.
- breckenedge 3y ago
  Eh it’s a depreciating asset, which you can write off over 27.5 years. There are plenty of advantages for owning SFR as an investment. And this article was written when rates were still stupidly low.
- t-writescode 3y ago
  "if you're not counting appreciation" is doing a whole lot of legwork in this sentence.
  - bombcar 3y ago
    It's doing all the legwork - SFRs are negative cash flow, and the only reason to hold negative cash flow properties at the absolutely horrendous cap rates they have is because of appreciation. But appreciation cannot go on forever or each property will be infinitely expensive and nobody will be able to afford them. It is a dance that will end at some point.
    - t-writescode 3y ago
      Australia is a fantastic image of what happens in that process, and they don't show much sign of slowing, being even worse than the States' issues.
      - bombcar 3y ago
        It can certainly go a lot longer than people will expect, and it will have weird side-effects (California also gives some hints, what with huge appreciation and prop 13). The biggest hurdle now is the jump from renter (or living with parents) to homeowner; there used to be "starter homes" that could get you on the treadmill but even those are quite high. Once you're on the treadmill it's not that bad as house prices in an area tend to be in lockstep, but that first step can be a big one.

rodgerd 3y ago

Restore serfdom.

VintageCool 3y ago

My guess is that houses are an inflation-resistant asset. It's a good place to dump money if you have too much. And the downside is limited by political inertia: most voters own homes and would suffer if their house lost value, so the American political system will sacrifice much to prevent housing prices from going down too much.

oilchange 3y ago

> I'd love someone in one of the "strategy" arms in one of these funds to explain what they think the end result of this is at it's extent? You buy homes in a region if you think the population will rise, interest rates will be relatively low, job prospects will be stable, etc which will lead to increasing home values. Whether they want to profit by flipping the homes or by renting them, I don't know. But it's a bullish bet on texas home prices by people who could politically influence human migration policy ( both domestic and foreign ), fed policy/interest rates and even jobs/economy. Meaning they can place the bet and pull the strings to make the bet pay off.

thisisit 3y ago

This is about cashflow. Consistent cashflow at that. To achieve that everything needs some sort of subscription model. Rent is the subscription model for housing. These consistent cashflows then can be bundled into some sort of financial products and sold to investors -- something similar to the financial products during the 2008 crash. Just that now instead of interest payments which might crash, rents can be stabilized. Even if things go wrong equity is still protected due to the house.

HDThoreaun 3y ago

1. Find a place with a growing population and restrictive zoning 2. Corner the housing market 3. The population keeps growing but the restrictive zoning means more housing doesn't get built 4. More people competing for the same housing stock means prices increase Whether they keep the housing forever or not isn't what they're thinking about, they can decide later.