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19% of California houses are owned by investors
- HWR_14 1y agoThat 19% excludes buildings/subdivisions specifically built to be rental units.
- breakyerself 1y agoPeople don't like being told that the problem is a housing shortage.
- jsbg 1y agoReally. If obsessive zoning and building regulations didn't artificially restrict the supply then there would be no reason for anyone to "invest" in houses.
- breakyerself 1y ago100%. I'm a far left anticapitalist, but facts are facts. Zoning, restrictive building codes, and the death of much of the housing construction industry post 2007. All contribute to housing costs and homelessness. I'd like to see zoning opened back up for increasing density wherever it's needed, but I would also like to see a strong social housing policy.
- rconti 1y agoThat doesn't strike me as true at all. Nationwide, housing has generally been a "good investment", regardless of whether we're talking about an area that restricts supply or one that does not.
- breakyerself 1y agoThe places where it's a good enough investment for investors to buy up real estate are in these high demand markets where housing supply has massively lagged demand. Homeowners may be satisfied that their home values have increased everywhere, but black Rock isn't buying houses in small towns in Idaho and ohio because the ROI isn't as high.
- tptacek 1y agoRents and home prices have repeatedly fallen in places that have authorized large scale new building. In the past, those price pressures were probably offset by large-scale moves from the northeast and midwest into the Sun Belt, but those appear to have mostly equilibrated now.
- grafmax 1y agoAn unregulated supply will still offer promising investment opportunities to those with enough money to buy them up. Look at crypto or private equity. These markets are lightly regulated. But prices are bid up by big money. Unfortunately just dumping regulation is unlikely to fix housing.
- tptacek 1y agoPeople say this but then never draw the rest of the owl. It costs money, substantial money, to hold on to a house. As soon as you propose that you're going to close that gap by renting the house out, you're competing in the market with everybody else letting out houses, and supply-and-demand kicks in. Can you explain the mechanism by which accumulating vacant houses would provide the same reward structure as crypto speculation?
- grafmax 1y agoProfessional property managers can scale the cost of ownership in a way individual owners can’t. Besides that speculators can also withhold supply, artificially inflating prices. 2008 occurred due to speculation, independent of NIMBY regulation. As for crypto, housing can actually be more profitable than crypto since investors see rentier income not just speculative appreciation. Ultimately, this isn't just a supply-and-demand problem in an idealized market. It's a resource allocation issue where investors with significant capital can hoard housing, driving up costs, while many people struggle with homelessness. Simply greasing the market with deregulation won't solve this fundamental imbalance.
- mordae 1y agoHuh. So, like, maybe if rents were not spiking and people were not bleeding money to predatory landlords, maybe, hear me out, maybe they would instead pay someone to build them a house.
- klipt 1y ago> pay someone to build them a house On what land? With what planning permits?
- NewJazz 1y agoSorry but this is a fundamental misunderstanding of supply and demand.
- bpt3 1y ago2021 called, it would like its performative talking points back. Build more housing, and "predatory" landlords will have more competition. The endless restrictions on residential construction are the root cause, not your envy of wealthy individuals. Side point: There are many people who are in no position to own a home or have one built for them. Where do they live if there aren't any landlords?
- breakyerself 1y agoPublic housing, housing cooperatives.
- jayd16 1y agoPercentage owned by investors doesn't really imply inventory vs demand, does it?
- breakyerself 1y agoInvestors tend to invest where the ROI is good. Which tends to be where demand is outstripping supply, but I don't think investor percentages would track that perfectly. I'd expect there to be confounding variables.
- gosub100 1y agoA problem, not the problem. Regulations block new supply. If this cannot be overcome, why not add another regulation that private equity cannot own houses? There's no reason they should not be subject to CAs extensive regulations too.
- tptacek 1y agoPrivate equity owns virtually none of the homes in the municipality I live in, just outside the city of Chicago, adjacent to redlined neighborhoods with abysmal schools full of families who would love a chance at the resources we have. Despite insanely high property taxes that depress housing values, our home prices set new records every year. Homeowners here would just love to spend a year workshopping regulations to prevent investors from buying homes. They know that those regulations would do nothing at all to address the scarcity that drives their home prices, and wouldn't result in them having to adapt to large numbers of new neighbors. It's the exact same reason they obsess over inclusionary zoning ordinances (IZOs). Affordability is so important! That's why we need new, toothier regulations to ensure that no new housing projects here can ever pencil out for the developers. PE is a complete sideshow. The root cause of the housing crisis is exclusionary zoning.
- akmiller 1y agoThat's because it's not. That's a cop-out. Wealth inequality is the crux of the issue.
- bpt3 1y agoThen why is almost every metric of housing affordability highly correlated to housing availability? Or maybe I am misunderstanding what "issue" you're referring to?
- akmiller 1y agoI'm not an economist but if you listen to Gary Stevenson talk about this very issue he discusses it in depth. But, when it comes down to it if EVERYTHING is getting more expensive that looking at on variable in one market can't be the crux of the issue. When you have large transfers of wealth and the wealth gap grows significantly the only thing for rich people to do is buy up assets. Assets are fixed, so the share of assets owned by rich people are drastically increasing. This is inline with the # of houses owned by private investors and #'s of assets owned by other investors will reveal the same thing.
- bpt3 1y ago> But, when it comes down to it if EVERYTHING is getting more expensive that looking at on variable in one market can't be the crux of the issue. Everything isn't getting more expensive. For example, housing prices and rents have gone down in areas where restrictions on new residential construction have been reduced. > When you have large transfers of wealth and the wealth gap grows significantly the only thing for rich people to do is buy up assets. That's not the only thing for rich people to do, but it is something people who make smart financial decisions do. > Assets are fixed, so the share of assets owned by rich people are drastically increasing. They aren't fixed in any asset class, so there's no real reason to explore your point here. > This is inline with the # of houses owned by private investors and #'s of assets owned by other investors will reveal the same thing. CA actually has a lower than average percentage of homes owned by investors, and I haven't seen any evidence it's increasing by a meaningful amount.
- twiceaday 1y agoThis is naive. The problem is that there are enough people with enough power who want house prices to keep going up. The solution must involve making them upset that they cannot get their way. Anything that doesn't have this shape is a stalling tactic in their favor.
- tamimio 1y agoNot entirely, the major factor is banks' credit creation. When any person can go and take a loan that was created from nothing (literal digits created by your bank), and sometimes based on another "speculated value" of a house you own, you will flood the market with an exponential rise of demand that will ALWAYS be higher than the supply. To solve the housing issue you have to follow the root cause, and always follow the money: first, halt credit creation, disincentivize it (ban interest), no speculation values. Second, make housing a depreciated asset, like cars, etc. Without these two, housing markets will never be solved. The thing is, the government knows that, but it's in its interest to keep the prices up, because that will mean more paid taxes! Which is why they fought WFH and created this hybrid model, to keep people around urban areas and keep prices up. I think Canada even admitted it later -I remember I read it somewhere. It's a multi-dimensional issue and the only losing party here is the average middle class person.
- kyleee 1y agoInstead of all those unrealistic things we should just build enough houses
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- ahmeneeroe-v2 1y ago[flagged]
- mrtesthah 1y agoHow many generations does it take before someone counts as a "real american"? Or is your "foreign-born" designation hiding that it was always about skin color all along?
- kittensmittens 1y agoI think once they’re citizens, and id say generally foreign born retain the $origin-american but their kids don’t always. I don’t think you typing in “purely a matter of skin color” is writing angry posts into the void that have nothing to do with the OP.
- mrtesthah 1y agoMy reference to number of generations centers around recent guidance from USCIS to de-naturalize citizens based on broadly defined criteria. The current discourse in this country centers around suspending habeas corpus to mass-deport millions of people. How do you know who's "illegal" without going through judicial process? You look at their race. And in the end, that's always what it's been about.
- kittensmittens 1y agoI don’t agree in general that’s how the system works or how most Americans think. But again that has nothing to do with the OP. I thought you were asking about American culture and I wanted to clarify.
- mrtesthah 1y agoNo, a majority of Americans don't think that way. But unfortunately mass deportation was the central platform of the Trump 2024 campaign, and race is now the defacto targeting criteria for ICE.
- acegopher 1y agohttp://archive.today/tq9Vw http://archive.today/tq9Vw
- deleted 1y ago[deleted]
- rawling 1y ago... and by the looks of it that's lower than (or as low as) any other state.
- xoqem 1y agoFor anyone who didn't click into the article, the headline may be misleading without the sub headline, which currently is "Relatively speaking, California is not a hot spot for housing investors". The map graphic shows that 19% is lower than other large states (e.g. 22% in Texas, 21% in Florida, 20% in New York). And lower than other west coast states generally (22% in Washington and Oregon, 25% in Nevada, and 23% in Arizona).
- taeric 1y agoIt would probably be easier to understand if worded the other way? 81% of California houses are owner occupied.
- deleted 1y ago[deleted]
- dgrcode 1y agoI think the 81% group would also include unocuppied houses, right?
- taeric 1y agoI have to confess I'm not sure. :( Searching for vacancy rate shows that is around 9%. I would expect these are owned by someone, though, such that I don't know why they would not be counted as investments? Doing the same search for "owner occupied" shows only around 50%, though. I don't know where to get the data that teases apart housing units and standalone houses.
- ashdksnndck 1y agoI’m interested in the methodology they use to identify investor-owned homes. Are they comparing known resident addresses to the names on property tax records? How does it work when multiple members of the same family have different last names? It seems fairly common for members of different generations of family (including in-laws) to live in a house that one person owns. How are you distinguishing an investment from a family living arrangement?
- rtkwe 1y agoEasy first step is anything not listed as owned by individual people. Investors will have some type of business ownership arrangement in 99%+ of cases and individuals will rarely have an LLC or similar setup for their purchases.
- fortran77 1y agoMy house is owned by an LLC that I own. I live in the house and don't rent it. If you count this way you will overcount by quite a bit!
- nemomarx 1y agoWhy'd you set up an LLC for this?
- dsr_ 1y agoIn most cases: privacy and ease of sale. You don't sell the house, you sell the LLC. The owner doesn't change.
- zie 1y agoThere are a few reasons: * Multi-ownership can be easier. I.e. you can "hide" who owns the house and it disconnects ownership from property records. * People think it adds liability protections. * It might make transferring the house at death easier to control(i.e. LLC rules apply, not state real estate rules) In the case of owning the house you live in under an LLC, the chances of it protecting you from most liability is 0%. The only thing I can think og it maybe protecting you from is debt obligations, if the person trying to collect from you didn't bother to find out why you don't own your house on property records. This probably has a very low chance of working anymore, but low is > 0 I guess. In order to have LLC liability protections you have to separate the LLC from your personal life, i.e. you have to treat the LLC as a real business, no mixing bank accounts, etc
- jimmytucson 1y agoTo save you a click, 19% is actually not a lot (I thought it was): > 19% of California houses were owned by investors, ranking No. 36 among the states and just below the 20% national norm. States with the highest share of investor-owned houses: > Hawaii at 40%, Alaska at 35%, Vermont at 31%, West Virginia at 30%, and Wyoming at 30%. States with the lowest are all in the Mid-Atlantic and lower New England: > Connecticut at 10%, Rhode Island and Massachusetts at 12%, and Delaware at 13%. Why so low in California (again, I'm baffled that this is "low")? > the sky-high price tag for single-family homes, the third-highest nationally at $866,100
- the_gastropod 1y agoIt's a pretty weird statistic because it ignores the denser forms of housing that are also owned by investors. So while 45% of Californians live in homes they don't own, "only 19% of homes are owned by investors" (the article repeatedly mixes the terms "home" and "house")
- tossandthrow 1y agoThat doesn't really qualify it for "not a lot". Look at it in a historic or idealized context. Personally I would say that is is a lot, and also too much - people tend to be less indifferent about things they own.
- AnimalMuppet 1y agoYou say it is a lot, but you also say to look in a historic context. So, got any data to present, to say that 19% is a lot historically?
- tossandthrow 1y agoI don't ground my judgement in historical trends but political conviction. You are free to go and find some statistics if that is what you want to ground your beliefs in.
- hk1337 1y ago
- nikanj 1y agoCalifornia real estate is such a tragedy, as huge portions of the population are suffering from a housing shortage caused almost exclusively by not building enough homes. A majority of people own real estate, so they're happy with the status quo. Why would you put up with even the slightest personal inconvenience from added housing, if all it got you was a reduced value of your property?
- koolba 1y ago> California real estate is such a tragedy, as huge portions of the population are suffering from a housing shortage caused almost exclusively by not building enough homes. The real issue with CA real estate is prop 13. It directly disincentivizes selling your home as you would be paying significantly higher taxes on the same house (same value etc) somewhere else. So if you do own a home, you’re much better off keeping it and renting it out rather than putting it on the market. The only thing stopping one from doing that is needing the home value itself as the down payment for their next residence. But even that can be avoided by getting a line of credit on your original house. If you want to fix CA real estate, scrap prop 13, force granny to sell and move to the boonies (to avoid the massively ratcheted property tax she will now be paying), and you’ll have a massive supply of homes for sale.
- nikanj 1y agoNo amount of tax adjustments can fix not having enough homes for the population. Focusing on those is a red herring
- arcticbull 1y agoI mean someone has to rent, to renters right? Not everyone plans to live in the same place forever, and not everyone wants to put up the capital to buy a place. Some percentage of housing needs to be owned by investors to make that capacity available for short-term living. What's the delta between 19% and neutral? California has a massive housing problem, which is just not building enough houses. Doesn't matter much to me who owns them.
- kamikazeturtles 1y agoWho owns them probably has an effect on whether new housing will be built. A city of mostly renters will vote to have rent controls. Your property taxes are a percentage of the assessed value of your house, usually 1-2%. If your houses value is increasing but rent is capped, the landlord business isn't going to look very rosy. No new rentals will be built. Of course, I could be wrong. Interested in counter arguments
- taeric 1y agoThis kind of cuts to the problem of conflating housing to houses. Most short term living is almost certainly better served by things other than stand alone houses. Is why colleges are dominated by dorms.
- whimsicalism 1y agoI prefer to rent whole homes and would appreciate that not being legislated away.
- taeric 1y agoI don't disagree? Just noting that that is largely not in this number.
- kamikazeturtles 1y agoStudents stay in dorms "for the experience". I don't think any middle aged person is looking for any communal living type experience. Also, what do you mean by "short term"? Usually it only makes economic sense to buy a house if you plan on staying there for 5+ years otherwise closing costs and realtor fees eat away any savings you made from not renting. The period of our life where we are the most mobile and willing to change cities due to job changes (20-40yrs) is also the period in our life when people start families and have children. I think most people prefer houses
- kamikazeturtles 1y agoWhy is Minnesota(14%) so low compared to other states? Our property taxes aren't that high. Maybe stable white color employing businesses mixed with a constant out migration of younger people, more likely to be renters, to the coasts?
- fortran77 1y agoAnd this is _less_ than the national average. In fact, below the median. From the article: > By this math, 19% of California houses were owned by investors, ranking No. 36 among the states and just below the 20% national norm. By county, tiny Sierra has the most (83%) and Ventura the least (14%).
- verteu 1y agoFrom my cursory analysis, "# of new housing units authorized" is by far the strongest predictor of rent & home values decreasing: https://i.imgur.com/BMsPrKY.png https://i.imgur.com/BMsPrKY.png (r^2 = 0.47, P-value 0.000) Nothing else ("% of housing owned by investors"?) is even close. edit: Yes, obviously I included a time lag (3 years). [1] https://constructioncoverage.com/research/cities-investing-most-in-new-housing https://constructioncoverage.com/research/cities-investing-m... [2] eg, https://www.zillow.com/home-values/10221/austin-tx/#/ https://www.zillow.com/home-values/10221/austin-tx/#/
- rconti 1y agoThat's surprising to me, given the lag time between authorization and completion, and the dynamic of people moving into a given area vs moving out.
- deleted 1y ago[deleted]
- klipt 1y agoHypothesis: investors rent out their investment housing (to make a profit) so it doesn't really reduce housing supply, it just shifts supply from owned to rented.
- tristan957 1y agoIt reduces supply for people who exclusively want to own. I'm not going to tell people what is the better financial decision for them, but there is a segment of society that wants to own a home regardless of whether renting is more financially beneficial.
- rconti 1y agoYeah, and it will depend a lot on the regulatory structure in the local environment, plus national things like interest rates. With prop 13 locking in below-market taxes, you'd have to be crazy to sell property in CA. With a different structure, you'd have to be crazy to keep it!
- rzazueta 1y agoIt was recently stated that 40% of owner-occupied homes are mortgage free: (https://www.fastcompany.com/91376388/housing-market-the-real-reason-a-staggering-40-percent-of-us-homeowners-are-mortgage-free https://www.fastcompany.com/91376388/housing-market-the-real...) Various stats put the ratio of owner-occupied residences to renter-occupied residences at roughly 70% to 30% (https://www.apartmentlist.com/research/rent-statistics https://www.apartmentlist.com/research/rent-statistics) Since only 40% of those "owner"-occupied homes have their mortgages paid off, that means the bank owns the other 60%. Doing the math, this means only about 28% of people actually own the place in which they live. The other 72% is owned by banks, investors, landlords, etc. That fully 20% of homes in California - intended to be owned by families or individuals as their primary residence - are instead served out as rentals, and this is a low percentage compared to other states, is a massive indicator of the one the key issues facing Americans: We don't own anything. Not even our own homes. Not even our lives, which we sell to others at a discount as "labor". When we don't own anything, we have no stability. When we have no stability, we live in a constant state of uncertainty, which is just another word for "fear". Fear makes us act desperately or angrily or selfishly. And the people who run everything use that fear to manipulate us into agreeing to be exploited by them - to work for them, vote for them, worship with/for/on them, etc. If you actually want peace and freedom and liberty and all those things Americans claim to care about, we need to start by building stability in our lives. That starts by taking back ownership of those things that belong to us through our efforts. The mortgage companies provide zero value to homeowners - they simply gate who gets to live in a home vs. who must pay for a rental, which is even more unstable. Replace hierarchies with cooperatives. Stop using money as the exclusive determining factor of whether someone is housed, fed, clothed, or cared for. Desperate people make lousy workers - ask any power and money pervert who believes in this system how hard it is to find good indentured servants who will just obey without complaining. Stable, cared for people make excellent workers - fear may be a motivator, but gratitude is an even greater motivator. When people are stable and able to relax, they are more often willing to contribute toward keeping that stability. You see this when people who have "free" time spend it volunteering for their community. If that stability comes at the expense of others, however, it's inherently unethical and leads us back exactly to the situation where we are now - where some people gain stability by manipulating others into working for them and stealing from them a significant portion of the value they create.
- dcreater 1y agoIts crazy that the article is missing the point that on an ABSOLUTE basis, 1 out of 5 homes being owned by investors is ludicrous. California's relative "not hot spot" is not the central issue.
- skeptrune 1y agoActually less than I would have guessed
- NuclearPM 1y agoIs that good?
- tptacek 1y agoSeems like extremely important context that 91% of these investor-owned houses are owned by entities with 5 or fewer houses: in other words, these are mostly houses that normal mom-and-pop homeowners bought.
- BergAndCo 1y ago[dead]
- lossolo 1y agoThis seems to be the source https://www.ocregister.com/2025/07/16/where-in-california-do-investors-own-the-most-houses/ https://www.ocregister.com/2025/07/16/where-in-california-do... "Most of California’s single-family house investors are “mom and pop” types, according to BatchData. Small-fry owners, with up to five properties nationwide, control 91% of California investment houses. The rest is divvied up this way: Owners of six to 10 houses control 4% of California investment houses. Investors with 11 to 50 houses own 3% of this Golden State housing group. And 51 or more? Only 2% of investment houses."
- cloverich 1y agoIt's notable but why is it extremely important exactly? It ultimately causes the same problem.
- tptacek 1y agoAmong other things, it suggests that concerns about institutional investors distorting the market (at least in California) are misplaced; they're a microscopic component of California house ownership.
- cloverich 1y ago> it suggests that concerns about institutional investors distorting the market Right but doesn't it merely change the target from institutional to non institutional investors? 1/5 to 1/4+ SFH homes being owned by non homeowners, and competing on prices, seems like the elephant in the room? Put another way does the fact that they are non-institutional meaningfully change the narrative and if so how would that relate to policy? It would seem a policy disincentivizing non-primary homeownership could apply equally to institutional and non-institutional investors alike.
- astrobiased 1y agoWhat I find odd is that definition of "investor" is not that clear. When you click through the links you get blocked at the data provider with no context. There's also a link to another post by the same news provider. When clicking through reference to the data source, the link doesn't work.
- insane_dreamer 1y agoThat number needs to be broken down between institutional investors and "regular" landlords who own a second property which they rent out (and likely either just covers the mortgage/taxes/upkeep, or is an older already-paid-for property i.e., inherited). The former is a business, the latter is not.