Housing Market/Economics - General Topics

[MNdible]

Playing with the tool, it would appear that the huge bulk of these investors are small time operators. If you shift the cutoff up to 10 units controlled, the share drops such that the highest concentrations are around 12%. Not sure if that really makes any difference, but it's not what the narrative would lead you to believe.

[SurlyLHT]

Playing with the tool, it would appear that the huge bulk of these investors are small time operators. If you shift the cutoff up to 10 units controlled, the share drops such that the highest concentrations are around 12%. Not sure if that really makes any difference, but it's not what the narrative would lead you to believe.

Thanks for the insight. I fear sometimes popular narratives are pushed without letting on that the story is more complex and need solutions to address the complexities.

For example the Wilder Foundation had a study saying homelessness in MN was up. I clicked on the raw data and found that a large percentage of those who were homeless in MN were basically refugees from Chicago. That additional information tells a more complex narrative which also has different needs.

[MattW]

A really good explainer from VOX on the economics of new housing.

https://www.youtube.com/watch?v=cEsC5hN ... =emb_title

[Anondson]

Fascinating story about the use of software by landlords to set prices for their unit.

https://www.curbed.com/2023/01/nyc-real ... -rent.html

The story investigates why rents never dropped despite New York City having large numbers of residents leaving during the pandemic. The program is called RealPage and it is being investigated by the DOJ for its role in “suggesting” rents based on the market in a geography.

Facilitating a collusion between landlords to set prices higher using algorithms?

[amiller92]

I'm going to not terribly helpfully mention that there has been much criticism of that article as well.

As for the DOJ enforcement, the Sherman Act requires an agreement in restraint of trade which makes enforcement against "tacit collusion" difficult. Might be a better spot for the FTC to expand the definition of "unfair methods of competition" under the FTC Act.

That said, DOJ just retracted three old policy statements that had included a safe harbor for information sharing amongst competitors where the information was aggregated and from a sufficiently large number of sources that may have applied to RealPage (indirectly as they were specifically about health care but had been considered applicable more broadly).

[Nick]

https://www.slowboring.com/p/the-pandem ... ending-the

[Anondson]

Cory Doctorow wrote a short essay, with links, positive towards rent control.

https://pluralistic.net/2023/05/16/mort ... t-control/

Lot of interesting thoughts in it!

[alexschief]

Man, that's not a convincing piece. I'm begging people to become more naturally skeptical of pieces that eschew any kind of analysis in favor of a lot of political in-group signaling and ad hominem attacks.

Sometimes I wonder what people think economics is, because the way they write about the field and its practitioners bears no relationship to reality. Economists did not invent the idea of incentives and sneering at the idea that people generally act in their own self-interest does not make it any less true.

As for the links about rent control, without delving too deeply into them, it's clear that they are studying and discussing very different types of rent regulations, from anti-gouging policies to fully-blown wartime rent boards. This detail goes completely unmentioned in the essay. One of my great frustrations with this debate is that proponents of hard rent control often justify their arguments by pointing to studies of much weaker rent stabilization policies. But the two are not the same, and pretending that they are (or, in the case of this author, probably just not knowing any of the details) is duplicitous.

[SurlyLHT]

Man, that's not a convincing piece. I'm begging people to become more naturally skeptical of pieces that eschew any kind of analysis in favor of a lot of political in-group signaling and ad hominem attacks.

Sometimes I wonder what people think economics is, because the way they write about the field and its practitioners bears no relationship to reality. Economists did not invent the idea of incentives and sneering at the idea that people generally act in their own self-interest does not make it any less true.

As for the links about rent control, without delving too deeply into them, it's clear that they are studying and discussing very different types of rent regulations, from anti-gouging policies to fully-blown wartime rent boards. This detail goes completely unmentioned in the essay. One of my great frustrations with this debate is that proponents of hard rent control often justify their arguments by pointing to studies of much weaker rent stabilization policies. But the two are not the same, and pretending that they are (or, in the case of this author, probably just not knowing any of the details) is duplicitous.

I agree, I had trouble reading the article, he jumped around so much. Economics is a tool, which provides data to inform decisions. It's neither the Saviour the right makes it out to be nor the Villain the left decries.

[Anondson]

Allegations that in our current market with very low supply, sellers are discriminating against FHA- and VA-backed mortgages. Resulting in an effective redlining as immigrants and households with low wealth are over represented among federally backed mortgages.

Increasingly sellers are avoiding the federally backed mortgages because of a required inspection.

https://www.minnpost.com/economy/2023/0 ... owner-gap/

[mattaudio]

Taking demographics out of it, why would a seller want to sell to someone with more complicated financing and a more difficult path to closing versus easier financing? Same reason why cash is king over financing - less risk to close.

[Tom H.]

Yeah, I agree, it's a very unfortunate outcome but not an explicitly discriminatory action that sellers are taking. Structural racism as opposed to racist intent (but maybe I'm giving people too much credit).

What's the solution to this? Do people in private sales really forgo a home inspection? Full disclosure, my first (and only) mortgage is FHA-backed but I can't imagine not having a home inspection under any circumstances. Stupid money out there, I guess.

[Anondson]

Fortune article alleging that changes in Minneapolis metro housing supply is a major factor for the region’s low inflation rate.

https://fortune.com/2023/08/09/minneapo ... minnesota/

I’m not an economist who can look at the metro housing supply numbers to confirm this. But it is a fascinating assertion.

[Anondson]

On a roll with the housing market stuff…

Minnpost again, writing about workforce housing in Greater Minnesota has had extreme struggles. The state passed a 10x increase in aid money.

https://www.minnpost.com/greater-minnes ... ture-help/

But doubts that one-time aid money is enough.

[Mdcastle]

Do you want to buy a house in this market?

If yes, keep in mind there's five people behind you that aren't going to demand a home inspection, either house flippers with cash or people that are apparently more desperate to buy a house than you are.

[Tom H.]

Do you want to buy a house in this market?

If yes, keep in mind there's five people behind you that aren't going to demand a home inspection, either house flippers with cash or people that are apparently more desperate to buy a house than you are.

You are undoubtedly correct, but I will continue to be astounded that people will make such an investment without an inspection, nor will I stop believing that such practices are introducing systemic problems into the housing/mortgage markets (which affects us all).

[BoredAgain]

Do you want to buy a house in this market?

If yes, keep in mind there's five people behind you that aren't going to demand a home inspection, either house flippers with cash or people that are apparently more desperate to buy a house than you are.

You are undoubtedly correct, but I will continue to be astounded that people will make such an investment without an inspection, nor will I stop believing that such practices are introducing systemic problems into the housing/mortgage markets (which affects us all).

I had a friend who would bring along an inspector on their initial house tour/viewing so that they could have an inspector look at the house, but avoid requiring an inspection after an offer was made. This was several years ago now.

[billhelm]

People send them to do them at open houses as well.

[Anondson]

Mother Jones on environmental activist groups vs housing supply in California.

https://www.motherjones.com/environment ... ity-nimby/

[Anondson]

Interesting attempt to rename different aspects of the national housing shortage ingredients.

https://www.liberalcurrents.com/the-vic ... n-housing/