patrick.net

 
  forgot password?   register

#housing #investing #politics more»
736,740 comments in 75,778 posts by 10,910 registered users, 6 online now: Blurtman, Dan8267, Gade, P N Dr Lo R, Strategist, YesYNot

new post

Without investor activity, we would not see price increases

By Patrick   2013 Jan 26, 8:46am   2,226 views   16 comments   watch (1)   quote      

http://www.vcstar.com/news/2013/jan/25/big-investment-firm-continues-to-buy-homes-in/

"Without the investor activity, we would not see the kind of price increases we're seeing right now," he said.

#investing

Comments 1-16 of 16     Last »

1   JodyChunder     2013 Jan 26, 11:45am  ↑ like (3)   ↓ dislike   quote    


"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.

2   inflection point     2013 Jan 27, 9:47am  ↑ like   ↓ dislike   quote    

Perhaps, time will tell.

3   Tenpoundbass   992/993 = 99% civil   2013 Jan 27, 9:55am  ↑ like   ↓ dislike (1)   quote    

All I know is if this place gets anywhere near $500K I'm selling, and will rent a hotel room until the bubble pops again.

Otherwise I'm ignoring this bubble altogether.

4   Blurtman   422/422 = 100% civil   2013 Jan 27, 10:23am  ↑ like (2)   ↓ dislike   quote    

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.

5   Blurtman   422/422 = 100% civil   2013 Jan 28, 1:05am  ↑ like (1)   ↓ dislike   quote    

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.

Dance, puppet, dance!

6   PockyClipsNow   60/60 = 100% civil   2013 Jan 28, 2:13am  ↑ like (5)   ↓ dislike   quote    

This is what zirp does. A 5% return on a SFR rental is considered awsome now.

7   errc   468/475 = 98% civil   2013 Jan 28, 2:30am  ↑ like (1)   ↓ dislike   quote    

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.

Weeeeeeeeeeeeeeeeeee!!

8   ELC     2013 Jan 28, 7:03am  ↑ like   ↓ dislike   quote    

JodyChunder says

let's quit with the trying to make it sound so respectable.

The moobs guy has got it right. Call them vultures.

9   Bap33     2013 Jan 28, 11:32am  ↑ like (2)   ↓ dislike   quote    

remove the Section 8 / Welfare that is pumped into the SFH rental market and the rents will drop low enough to bring housing in line in short order. My opinion.

10   David Losh     2013 Jan 29, 1:15am  ↑ like   ↓ dislike   quote    

Bap33 says

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.

11   David9   1/1 = 100% civil   2013 Jan 29, 1:26am  ↑ like   ↓ dislike   quote    

Thank You Patrick.

I'm at work in Ventura this second, as I have been for 3 years.

The only major employers in the area are the government, one hospital, and Amgen. Here is a list:

http://www.labormarketinfo.edd.ca.gov/majorer/countymajorer.asp?CountyCode=000111

I commute from Tarzana because I refuse to be away from the more populous business center of Los Angeles. Even the Java progammers say the area is 'not strategic'.

But, house prices are up, up, up, expensive, expensive, expensive.

12   Bap33     2013 Jan 29, 5:17am  ↑ like   ↓ dislike (1)   quote    

David Losh says

Bap33 says



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.
To recap:
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.

13   RealEstateIsBetterThanStocks   174/174 = 100% civil   2013 Jan 29, 7:20am  ↑ like   ↓ dislike   quote    

maybe so but without the real bottom we would not have seen investor activities :D

the moment WallStreet jumps in is the moment you know the market has bottomed.

14   inflection point     2013 Jan 29, 12:12pm  ↑ like   ↓ dislike   quote    

Mark D,

Sorry. ZIRP has driven wall street into any investment with a spread greater than their loan rate of 0. They will be just as quick to bail as soon as the market is on its way to the real bottom.

15   Mick Russom     2013 Jan 29, 12:22pm  ↑ like   ↓ dislike   quote    

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.

16   Mick Russom     2013 Jan 29, 12:23pm  ↑ like   ↓ dislike   quote    

And Yes, if there wasnt outside investment (more like illegal laundering of criminal money), this market wouldnt be in rebound.

Comments 1-16 of 16     Last »

users   about   suggestions   contact  
topics   random post   best comments   comment jail  
patrick's 40 proposals  
10 reasons it's a terrible time to buy  
8 groups who lie about the housing market  
37 bogus arguments about housing  
get a free bumper sticker:

top   bottom   home