3 ms·
Is there any evidence that private equity owns a significant percentage of homes? Absent any strong data, I am skeptical that PE would purchase (and hold) larg
by takinola 3y ago
Is there any evidence that private equity owns a significant percentage of homes? Absent any strong data, I am skeptical that PE would purchase (and hold) large swaths of residential real estate. Unlike, commercial real estate, the operations component of maintaining the buildings (outside of apartment complexes) would be complex and hard to scale. I am open to be disproven but it just seems like a much more unwieldy asset class than PE normally deals with.
- dugite-code 3y ago> a significant percentage of homes The real question is what is a significant percentage? My understanding was that the housing stock has always been so tight that residential vacancies (rental/sales) have always been in the single digit percentages. So if a private equity starts buying just a few percent they put an outsized pressure on a tight market. Add in things like airbnb, foreign sales and the limited capacity in time and labour for construction you have a recipe for exhausting the already extremely limited suppy
- takinola 3y agoThat is why I used the qualifier "significant" as in enough to influence prices. What percentage of SFH sold are bought by PE each year? What percent of homes are held by PE? I would be surprised if either one is even in the high single digits. I can definitely see Airbnb or foreign buyers being a factor in some local markets. In both these cases, the operational aspect of home ownership is less of an issue since the ownership is diffuse.