"Invitation Homes has targeted Ventura County as one of 10 markets nationwide in which it has purchased more than 12,500 homes as part of business plan to become the nation's first large-scale, brand-name company in the single-family home rental market.
"Without the investor activity, we would not see the kind of price increases we're seeing right now," he said.
In all honesty, I think the word "investor" is bandied around too much. It's a shameless attempt to spiff-up what is market speculation, gambling, and finally, retail-level rentierism. Not that I judge, being a dirty speculator myself -- but let's quit with the trying to make it sound so respectable.
Brilliantly executed by the PTB. We all know that if the Invitation Homes strategy goes south, they will walk away from the debt, and be able to borrow again. But not so for individuals. Similar to HSBC money laundering. They can do it with a smack on the wrist, but you will go to jail for a long time. This is results in a type of arbitrage, designed by those who rule this country.
The brilliance of the strategy is that due to destroyed credit ratings, many folks are forced to rent (and possibly for everyone's benefit). But RE developers, hedge funds and large investor groups can walk away from bad investments with impunity. So Wall Street can create a bubble, the little guy jumps in, gets in over his head (also his fault), defaults, has his credit rating destroyed, and now must rent from Wall Street.
At least we can breath a collective sigh of relief. Knowing that all the quality materials and craftsmanship that went into building the last twenty years of housing stock, coupled with corporations owning and maintaining with such care and preservation, will set us up for such a bright future. Can't you just smell the perpetual house price inflation! These shitshacks will all be worth bazillions within the next decade.
And without wings, a bat would fall to the ground too.
So if investers are the wings who is the bat?
Wait... I get it; the rising price of real estate is like a vampire on the working people and the investors are the wings keeping it flying. Otherwise "common" people could buy homes at less than double the PITI, and spend the rest of their money in our consumer economy.
Are high housing costs (rent or PITI) a vampire on our economy?
remove the Section 8 / Welfare that is pumped into the SFH rental market and the rents will drop
A lot of people contend Section 8 keeps rents lower for a wide variety of reasons. Trashed properties, lower rents, surrounding price pressure on surrounding properties, and the like.
Section 8 is a tough way to make a buck.
All of the big RE players in my area use Section 8. And, the highest priced rents paid in the middle and low income areas are Section 8 properties. Worst of it all, in my opinion, is Section 8 rent in a SFH means tax payers are paying for an investors private property, that the investor can remove all of the equity from the home to use as he wishes, or even go into foreclosure due to unpaid mortgage. All done with an assett that has been paid for by tax payer funds.
Maybe if the home has no mortgage, then allowing Section 8 may be a different deal. But, if a home is leveraged in a debt, then having tax payers pay the rent is just crap.
1) Section 8 pays the highest rents in the low/middle SFH market in the central valley.
2) In the central valley, every RE investor that has been picking up the stucco wrapped POS SFH use long term Section 8 (the one that pays for repairs to return the property to "as rented" condition)
3) The rents being paid by Section 8 are 3X what an FHA mortgage would be on the same property
4) In the central valley, Section 8 /HUD has started allowing their renters to "buy" homes ... I like that better, since the State gets to keep the home if it is never paid for by the Section 8 / HUD buyer.
5) Section 8 has a direct effect on the rental market in much the same way any welfare used in any market effects the prices. Wage earners who compete for the goods or services being accessed by welfare will pay more due to a false competition. In my opinion, when rent money is handed over for free their is less motivation for the RENTER to find cheaper housing. They move in, the neighbors get tired of the crap and move out, Section 8 renters move into those newly vacant homes, and you now have the perfect seed for a ghetto full of rentals, instead of a subdivision full of owners.
This has all been covered. But it works like this. The boom bust cycles allow the banks to collect the real paper, the Titles.
So for banks, who are too big to fail and get bailed out, they end up in an ultimate collapse scenario owning all the "paper". All the titles and deeds to all the properties everywhere is what ends up happening if they get it wrong, and if they get it right, they fleece the working folks of their entire standard of living.
The banks are pan national - so no longer is the wealth even contained within a country.