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What happens when private equity buys homes in your neighborhood

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61 points pseudolus | 1 comments | 09 Sep 25 17:32 UTC | HN request time: 0.389s | source
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jameslk ◴[09 Sep 25 18:34 UTC] No.45186475[source]▶
> But the bigger problem for housing affordability, he adds, is that "we just haven't built enough [homes] to keep up with the population growth and household formation."

The circular incentive here is left unsaid. If a house is an investment, you and every other homeowner has an incentive to keep supply low and demand high. This ultimately drives votes, lobbying, and policies that prevent houses being built. Otherwise you end up with falling rents and stagnating property prices, like in Austin.

https://www.apartmentlist.com/research/cooling-rent-growth-d...

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nineplay ◴[09 Sep 25 19:08 UTC] No.45187123[source]▶
How do you end housing as an investment?
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1. jameslk ◴[09 Sep 25 19:18 UTC] No.45187308[source]▶
I don't have an answer to that (I'm sure others do) but I do feel this is a problem that can only make itself worse

The more prices go up, the larger % of net worth for an individual a home consumes. If your entire net worth is wound up in your home because your home costs so much, your incentives are much higher to keep the price of your home from falling than if it was just a fraction of your net worth. Worse yet if you're in debt and you have to sell

The longer this problem goes on, it seems the harder it will be to rectify