I had this same reaction! All of the process of getting to and from the airport, and through security, etc, isn't my favorite. But once we're actually flying, I find the ride itself kind of soothing.
I do too,kind of, but I don't like the atmosphere / air in planes; too dry, smelly, too warm and too cold at the same time, there's just something environmentally "wrong" in planes. Maybe that's just a matter of getting used to it though.
For 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).
I think another metric that's probably just as important is what percentage of those investors are large institutional investors vs. "Mom and Pop" landlords with one house for rent.
I mention that because I remember reading during the pandemic that institutional investors generally make shittier landlords: they're quicker to evict, quicker to raise rents, less likely to work with a tenant on a payment plan, and they have fewer ties to the community. There was a concern that with all the eviction moratoriums during the pandemic that large landlords could wait it out, while smaller landlords got screwed and got out altogether in some cases, leaving their housing stock to be gobbled up by the shittier institutional landlords.
George Orwell made a comment that the landlord in the impoverished coal mining town he visited was usually an old widow.
Always gets me is the ideological contortions people will get up to in order to not face that California is short a couple million units of housing. Really the US has been investing in looting schemes and not in build out for the last 40 years.
I 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.
Where are you seeing 9% vacancy rate in California? According to FRED, the current rental vacancy rate in CA is below 5, and the current home vacancy rate is below 1.
Hmm... I thought I just took the basic google, but that seems to give a different result now. Maybe I just fat fingered copying into here, not sure.
I know that my main assertion there was it was a relatively lower number. Adding it to the 19 of this story would still leave owner occupied higher than 50ish. Such that I clearly need help to put a lot of this together.
California houses are not popular with professional “landlord” investors because the cap rates (net operating income / house value) are poor. Rents are limited to what potential renters are actually able to pay, while the prices are very high.
On the other hand, during the upswing in prices, house flipping in California was really popular with investors because the (then) low interest and likely capital gain made things easy.
The headline isn't misleading unless your only concern is placing California in relative position.
The headline is true and relevant if you are wondering how investors influence housing prices - with a 20% share, clearly investors influence prices a lot. Moreover, California is where the housing bubble began but it's quite logical it's no longer where the bubble is concentrated so again 20% doesn't imply investor ownership is unimportant.
Good point. Similar to how the share price of a company is meaningless, total capitalization is the only useful metric. Similarly, investors have gone to great expenses to commit their money into 19% of California's housing, greater expenses than any other state, even when considered on per-capita basis.
To understand the meaning of this, consider that supply/demand curves are naturally non-linear and even 5% increase in demand can double the prices.
And yet 20% of the market being captured by those who already have a home, while so many go without one, indicates a shortcoming in our society’s ability to distribute resources from those who don’t need them to those who do.
Renting a home out isn't "capturing" the house. Rental housing is a desirable product. Lots of people don't want to own, be locked into a particular house for years to offset transaction costs, and to own all the downside and maintenance risk of the property.
Consider soliciting the opinion of more renters. Plenty of us would happily purchase if prices were more reasonable. Renting out sfh should be rare, imho. The current situation needs many remedies and kicking out sfh as investment vehicles is a very low hanging fruit.
Kicking out sfh as investment vehicles makes it harder to sell homes. This a) increases the risk to home buyers and b) makes owning inventory more expensive. Thats likely to make increasing supply untenable.
This low hanging “remedy” is likely to exacerbate the supply issue, not help it.
Demand would still outstrip supply, so by what mechanism would selling be difficult or risky? It would modestly reduce prices, making it less expensive for all regular home owners. That's a win for everyone but (sfh) investors.
Home builders are “investors” in sfh. So out of the gate you’ve got a problem with making the regulations more complicated to navigate. For the people creating supply.
Some of those homebuilders build because they can rent homes if they can’t be sold. Others build because they have large investors to sell to if necessary. All of them build with their financial models account for carry time, as carry costs are extremely important to their bottom line.
If the average carry time goes up even a little bit (and it will because investors close faster) that can make whole developments untenable.
> So out of the gate you’ve got a problem with making the regulations more complicated to navigate.
Assuming the policy to reduce non-primary home ownership is tax based, carve out tax exceptions for home builders. Personally I would carve out exceptions for home flippers too, but could see that being more contentious. Either way though, this part of the problem would be, IMHO, trivial to solve.
> If the average carry time goes up even a little bit (and it will because investors close faster) that can make whole developments untenable. Others build because they have large investors to sell to if necessary.
I think that's fair. But conversely carry time is also high because prices are high, and investors drive up prices; builders also do this to an extent, by e.g. buying down points to avoid lowering prices, to keep the perceived price elevated. I have no illusions this is a simple problem to solve. The right question here is probably figuring out whether the overall supply going up by X increased rate because of investors will be worth the cost of the total homeownership rate being controlled by a shrinking proportion of the population (I would guess no).
My personal proposed solution here would be to kick out investors (tax policy), and also directly incentivize home builders selling to first time owners (via tax credits, comparable to e.g. EV tax credits). The latter would be quite expensive, but if the overall homeownership rate increases and home prices drop, it would likely be popular.
Homeownership rates are not particularly out of band right now. They’ve kept within a couple of % points for the entire post ww2 era. They’ve kept within track almost exactly mortgage rates. They are higher they were 10 years ago for instance.
But note that’s not the same thing as housing affordability. You probably can goose the homeownership rate by appropriating a bunch of homes and redistributing them to the marginal buyers who are currently not owners.
But it will not drop the price of housing, it will increase it because supply will still be constrained (think of the normal case of someone moving temporarily for work. If you disincentivize them being allowed to rent the unit out you now have 2 units off the market).
Carry cost is mostly about financing costs and regulations not the price of homes.
Tax incentives for first-time home buyers are enormously regressive. You're operating from a presumption that everybody intends to buy a house (see upthread), but that's not true, and it gets less true as you go down the income ladder. Owning a home comes with huge downside risk, added expense, and loss of flexibility.
Spoken like someone who never lost their shirt on a house after discovering they had to move a couple years after buying. No, I'm pretty confident: lots of renters are renters on purpose. Ownership is not categorically better than renting.
To spell it out, they seem to be completely ignoring that those rental properties are not vacant. Instead, they house people, just like they would if they were owner occupied.
20% of market capture does not cause homelessness, but there are many very valid arguments that treating housing as an investment isn't a stairway to ending homelessness.
Turbo Greed (acquire all the things) and lack of monopoly protection and enforcement.
If we're going to tackle homeless, we have to remove systems that incentivize the collection of homes as a financial asset. Make more homes by one person or entity less desirable or simply undoable.
Turbo greed isn't a thing. And if you think there's a monopoly in residential real estate ownership, you have an absurdly broad definition of the term.
Instead of trying to manipulate a market through yet another layer of regulation, you can just let builders build more.
If turbo Greed isn't a thing, why do the 830+ billionaires in the United States control more wealth than the bottom 50% of the population?
And, why did we just give them a YUGE tax break?
"Build more" is not an option, because the incentives don't align to solve the problem. The things getting built are built to capture margins and not to solve the housing problem.
You're missing the point, which is that adding a superlative in front of a concept you don't like doesn't make it more important or the problem more severe. And your reductionist take on wealth distribution isn't even worth discussing.
Build more is the only option to actually fix the problem. The incentives could not be more aligned between home builders and home dwellers. Builders want to build, and there are dozens of them in all major metropolitan areas. Home dwellers want shelter. Sounds like an ideal situation to keep margins low.
More regulation == more regulatory capture, which your kind supposedly doesn't like but you don't seem to be able to help yourself.
I don't know what the fuck "my kind" is, but you instantly threw away any validity you may have remotely had by jumping to some nonsense like that.
I'm not "missing the point" because I don't agree with economic principles that got us where we are today. Doubling down on those very same principles thinking we will have a different outcome? Nonsense.
"Your kind" are the type of people who use terms like "turbo greed" and expect to have their opinions taken seriously.
It's not a coincidence that there's a huge overlap between people who use terms like "turbo greed", those who "don't agree" with the economic principles that have outperformed all known alternatives, and those who think that more state involvement is the solution to every problem.
I think it's just an indication of how many people see themselves in the words, regardless of who wrote them, and hope to find some direction in the resulting discussion.
As I recall it was a pay-per-article model (around 25 cents per article looks like) and it had a number of publications to choose from. Though I haven't used it lately, I like the idea.
Doesn't that get you back to the problem of click bait? If newspapers are only paid for articles with headlines that grab your attention, then that's where their incentives will drive them. Part of the attraction for newspapers for me is that you're sort of forced to read the other articles as well.
There were numerous legal ways to stream the Super Bowl online and on mobile this year for free, it appears these numbers may not include those? I would be curious to see what percentage of viewers used an app or site to view the game this year, and if it makes up for the relatively small drop in TV viewers.
This particular point has always been a bit funny to me.
I mean, sure, there are super racist areas in the south. I grew up and lived in mostly rural Alabama for the first 20+ years of my life, and there were some rural areas that were just as terrible as people imagine (cross burnings, open Klan meetings, etc, though that was starting to die down in the last 10 years or so I lived there).
That said, a lot of cities in the south are 30% - 50% black (sometimes more), and people who live in those cities, generally speaking, coexist and interact with many black and white people on a continual basis. It'd be kind of hard to do that and be super racists to the level people imagine the south to be.
I talked to a lot more black programmers in meetups in Atlanta than I have in San Francisco (I'm not American and was a visitor in both places) & was surprised by how biased against the former people in the latter were, despite evidence to the contrary.
In Atlanta race is not a special issue, it's a fact of daily life. Interacting with black people isn't an unusual event where you get to pat yourself on the back for 'not being racist'. It's simply what happens everyday.
Or maybe I am just bitter about a 70% white city talking about how racist a 53% black city must be.
This hasn't been my experience at all. I moved to Seattle from Alabama (almost 10 years ago now), and openly tell people I'm from Alabama, and I've yet to feel discriminated against because of it. In fact, some people are a bit envious of property prices there. I think mostly they are just glad I'm not from California ;).
It is a text message service that purports to handle just about any request you make (food delivery, whatever), they just tack on a fee to the price. They had to limit to a wait list, as the demand exploded.
One thing that I learned (accidentally) that helps when watching a fast paced Vine video like this, you can click the video to pause it, and again to resume playback (useful for trying to read the buttons that are being clicked, for example). Maybe everyone else already figured that out, ha, but I think GIFs conditioned me to think things like this didn't have pause built in.
