3 ms·
"Wall Street" is a bit disingenuous. From the original study: "We defined institutional buyers as companies, corporations, or limited liability companies (LLCs
by refurb 3y ago
"Wall Street" is a bit disingenuous.
From the original study: "We defined institutional buyers as companies, corporations, or limited liability companies (LLCs)."
It's very common for mom and pop landlords to buy homes through LLCs for liability protection.
It would be more fair to say "up to a third of Texas single family homes were bought as investments", rather than say "Wall Street" which infers some massive PE firm bought them up.
If you go to Canada, it's closer to 70% of recent purchased in the lower Niagara region of Ontario.
"Investors own 77 per cent of new condos in Waterloo region"
https://kitchener.ctvnews.ca/investors-own-77-per-cent-of-new-condos-in-waterloo-region-1.6273766 https://kitchener.ctvnews.ca/investors-own-77-per-cent-of-ne...
- forgetfreeman 3y agoBut massive PE firms absolutely are buying up homes. So much so that it's getting really hard to operate in this market profitably if you're a small time player.
- nocoiner 3y agoStill seems like a reasonably proxy for “financial investors” (as opposed to the accidental investors who bought a starter home at the right time, and now it’s grossly inflated value makes it the checkbook for all four college educations). And though I think you acknowledge this point, but a lot of people with mom and pop landlords don’t realize that mom and pop are definitionally real estate investors.
- WillPostForFood 3y agoMom and pop are definitionally not "Wall Street" investors which is what the article is labeling the purchasers.
- bombcar 3y ago> It's very common for mom and pop landlords to buy homes through LLCs for liability protection. As a side node, for mom and pop landlords this is more of a myth than actual liability protection. It's arguably more useful to keep various properties separate so you can sell them easier than anything else. Maybe some liability protection if the LLC is named such that people don't realize you own it, but any actual liability lawyer will see right through it.
- refurb 3y agoThis is true. Just plopping a property into an LLC doesn't give you automatic liability protection. It has to be treated as a separate business.
- bombcar 3y agoAnd even if it is a separate business, you probably only get protection from things like unpaid bills, etc. Liability (especially criminal liability) will pierce the LLC quite rapidly.
- clipsy 3y ago"The rentier class" would be a more accurate description, yes.