Big corporations are buying up homes and “eroding the American dream of homeownership

[jmecklenborg]

Originally Posted by Kngkyle

The owner being present during a showing or open house is completely foreign to me and I've looked at well over 100 properties in the past 5 years. I guess different customs in different markets? That is definitely not how it works in Chicago.

Yeah, unfortunately all of this anti-realtor, anti-appraiser hysteria (I'd bet it's coming from the usual suspects - Twitter and Reddit) is coming from people who are taking advantage of people who don't really understand the process.

[jmecklenborg]

Originally Posted by Wigs

jmecklenborg,
I don't care if you call BS. You think corporate ownership of massive amounts of housing supply across the country is a good thing.

I never commented on corporate ownership. I didn't say it was a good thing or a bad thing. Good or bad, it's not permanent. If the cap rates drop, the corporations will put homes on the market, and they'll revert to ownership by individuals.

You also own your own house and investment properties when many in North America have been priced right out of the market and dream of home ownership.

I also worked two jobs for 15~ years to achieve this. 70 hours a week, year after year. Worked with plenty of people who made fun of me for working "too much" who still don't have a positive net worth because they sat around watching TV.

the roof leading to an entire generation of folks that can't ever afford a house unless they move to the absolute cheapest and usually least desirable parts of the country.

Yeah, that's where I live. This week, a writer in the Washington Post called my area "a good place to fly over".

You clearly didn't even care to look at any links from publications across the country stating discriminatory home appraisal practices are occurring to educated, upper middle class Black people. Even happened to Black Professors at a prestigious and well respected institution such as Johns Hopkins university, no less!

I am extremely skeptical of that story. First of all, these alleged appraisals (the reporter doesn't indicate that they personally reviewed the original appraisals, only the language of the lawsuit) are for a refinance, not a sale. If the current owners bought the house for $450k and they owe $350k on it at the time of the refinance, why do they care if it's worth $475k or $750k? If they're doing a cash-out and want the max amount, then yes, but the report makes no mention of this, so I'm assuming that they were not doing a cash-out.

And moreover, it makes absolutely no difference to the lender, since the new mortgage will be for far less than either appraisal. The first appraiser just showed up and slapped something together. Easy day at the office. End of story.

As I mentioned in my previous post, I did a cash-out refinance of one house in early 2021 when rates dropped. They definitely did not send an appraiser out, they just used comps. I got a $22,000 cash-out the first week of June, threw it all in the stock market, and made like $7,000 in two months. If they hadn't been so backed up, and the closing had occurred in late April or early May, the cash-out would have been invested deeper in the shutdown crash, and I would have made more on the bounce-back.

It's not happening because I've never experienced it as a White male is quite the argument.

I've already shared my skepticism of the story.

(You're also the dude that claimed in another thread that LA would no longer be the center of TV and film production and we see no evidence of your past claims )

Yeah, in 10 years there won't be many human celebrities. They'll replaced by be AI-generated entities in AI-generated shows and movies. These "celebrities" and their content can and will be made anywhere.

[montréaliste]

Yeah, in 10 years there won't be many human celebrities. They'll replaced by be AI-generated entities in AI-generated shows and movies. These "celebrities" and their content can and will be made anywhere

Yes, and I’m pretty sure a bunch of AI humanoids will be munching on popcorn and taking over our human consumption habits to justify the lack of interest in human generated art and entertainment…


Players have been on pro sports games for a quarter century, and pro sports attendance and profitability have not suffered much from the emulation.

[TempleGuy1000]

If you guys want to read about an absolute worst case scenario, read about ABC Capital. They bought thousands of houses in Philadelphia and Baltimore with foreign investor money and it was basically a ponzi scheme to defraud people. Evil people...

ABC, a partnership between a Delaware County serial entrepreneur with a rocky business history and two Israeli expatriates, was involved in the purchase of some 1,900 Philadelphia properties over the past decade through a network of more than 600 individual companies it set up largely for overseas investors. ABC promised those stakeholders a turnkey investment opportunity, selling them homes in the city’s poorest neighborhoods, and assuring them that lightning-fast renovations and efficient property management would transform dirt-cheap properties into revenue engines.

But today investors and housing advocates allege that ABC’s vast scale was possible only because it was a scam — one that bilked investors, endangered tenants like Knox with shoddy and sometimes illegal construction work, and left a legacy of blight that may extend to hundreds of properties across the city.

The Pa. Attorney General is probing ABC Capital, a former Philly real estate firm accused of scams


ABC Capital hit with three new federal lawsuits alleging Ponzi scheme involving Baltimore properties

[suburbanite]

Originally Posted by chris08876

What's a good salary or income range per year in CAD to say live "comfortably" in the Toronto region?

How about Vancouver?

What's a good range for say home ownership there (single family) and yet be able to live comfortable?

Was looking at Vancouver prices and its asinine, even after the CAD to USD conversion? Its like a whole city of C-Suits and Doctors to be able to afford anything there. I must be missing something.

You're probably not finding anything suitable for a family of 4 for less than $1.5 million in Toronto. With an expensive downpayment of 20%, a 30 year mortgage at 5% is still about $6,500 a month.

Take home pay on a salary of $200,000 is about $125,000. So if you want less than 50% of your after tax income going towards your home you need to be earning more than $200k.

[hipster duck]

Originally Posted by chris08876

What's a good salary or income range per year in CAD to say live "comfortably" in the Toronto region?

How about Vancouver?

What's a good range for say home ownership there (single family) and yet be able to live comfortable?

To be somewhat fair to places like Toronto and Vancouver - but also the other expensive cities of the world - "comfort" is kind of defined by the kinds of homes that other people in your social class live in, and since single family homes are both rare (<25% of all homes in Toronto, and declining) and very expensive, nobody will judge you if you don't own a SFH by a certain point in your life the way they would in, say, Arkansas.

Without getting into too many details, you need a household income in the six figures to buy your first property of any kind in Toronto today if you don't have any family money.

Toronto and Vancouver - like pretty much every other expensive city in the Western world - rely on a combo of immigrants who don't mind making big housing trade-offs because they're not used to North American lifestyles, young people from other places who don't mind making big housing trade-offs because they don't have children and want to live in the big city, locals who live with their parents/get family money to buy their first home, and rich people.

[Nouvellecosse]

I think the elephant in the room is that the majority, or at least a large plurality, of home buyers are prior home owners. So high home prices aren't an issue when buying a home when you were paid a handsome sum for the one you just sold. It's mostly just first time prospective home owners having an issue. And to a lesser extent renters, but rent prices aren't as high comparatively.

[iheartthed]

Originally Posted by Nouvellecosse

I think the elephant in the room is that the majority, or at least a large plurality, of home buyers are prior home owners. So high home prices aren't an issue when buying a home when you were paid a handsome sum for the one you just sold. It's mostly just first time prospective home owners having an issue. And to a lesser extent renters, but rent prices aren't as high comparatively.

Yeah. What's changed most since the 1970s is the size of the downpayment versus income. In 1976, a 20% downpayment on the median home was about 59% of the median annual income. In 2022, a 20% downpayment on the median home was about 103% of the median annual income. This makes it a bit harder for people to enter the housing market without help. But for people who have resources to leverage for help with down payments, the monthly payment would not be more burdensome than what was typical 50 years ago.

[jmecklenborg]

^Banks didn't count a wife's income (technically, the lower of a married couple's two incomes) toward mortgage lending until around 1970. That's why new American homes exploded in size in the 1970s and 80s.

[Crawford]

I'm still confused how so many American households value size, rather than location, when homebuying. Especially at the higher end. Yeah, more size has value, but past (say) 3,000 sq. ft. or so, we're talking seriously diminishing returns, unless you have like five kids or have some weird home usage, like a hockey rink in your basement. So many higher income households who would take a 6,000 sq. ft. McMansion in a cornfield over a 3,000 sq. ft. home in a mature neighborhood. To me, very weird.

[Steely Dan]

Originally Posted by Crawford

I'm still confused how so many American households value size, rather than location, when homebuying. Especially at the higher end. Yeah, more size has value, but past (say) 3,000 sq. ft. or so, we're talking seriously diminishing returns, unless you have like five kids or have some weird home usage, like a hockey rink in your basement. So many higher income households who would take a 6,000 sq. ft. McMansion in a cornfield over a 3,000 sq. ft. home in a mature neighborhood. To me, very weird.

well, you're looking at it through your higher income bracket lens.

for most middle class families, the choice is more like a 2,000 SF house on a tiny lot in the city or a 4,000 SF vinvyl box with a huge backyard out on a cornfield.

i happily chose the former, but i have many chicagoland cousins who seem content with the latter.

one big difference: they all rotate hosting the big family parties (40+ people). we never do.

[Trae]

Originally Posted by Crawford

I'm still confused how so many American households value size, rather than location, when homebuying. Especially at the higher end. Yeah, more size has value, but past (say) 3,000 sq. ft. or so, we're talking seriously diminishing returns, unless you have like five kids or have some weird home usage, like a hockey rink in your basement. So many higher income households who would take a 6,000 sq. ft. McMansion in a cornfield over a 3,000 sq. ft. home in a mature neighborhood. To me, very weird.

the number one thing valued is cost, so this eliminates many of the higher end inner city locations. second most valuable thing is safety so this eliminates other inner city neighborhoods. third most valuable thing is neighborhood schools so this eliminates the rest. these reasons are why people end up in the suburbs. Housing size comes in at four or five, being flip flopped between yard size which for some is more important than home size.

[iheartthed]

Originally Posted by Steely Dan

well, you're looking at it through your higher income bracket lens.

for most middle class families, the choice is more like a 2,000 SF house on a tiny lot in the city or a 4,000 SF vinvyl box with a huge backyard out on a cornfield.

i happily chose the former, but i have many chicagoland cousins who seem content with the latter.

one big difference: they all rotate hosting the big family parties (40+ people). we never do.

I think it's more of a New York vs non-New York culture. New York has the strongest correlation between price and distance from the core in the country (maybe world?). People of all economic groups tend to value commuting time and access to public transit much higher than space.

[Crawford]

Originally Posted by Trae

the number one thing valued is cost, so this eliminates many of the higher end inner city locations. second most valuable thing is safety so this eliminates other inner city neighborhoods. third most valuable thing is neighborhood schools so this eliminates the rest. these reasons are why people end up in the suburbs. Housing size comes in at four or five, being flip flopped between yard size which for some is more important than home size.

Safety and schools are almost always better in the established suburbs as opposed to the McMansion suburbs. Schools are generally vastly better.

Cost is obviously lower on the fringe, but my confusion is why high-income people (i.e. people with options and not forced into location based on home price constraints) often choose a giant home in a cornfield. Makes little sense, to me, unless they only care about having as big a home as possible. I just don't understand how there's added utility beyond a certain size.

And I don't agree that these are the only factors. People consider proximity to employment, amenities, family & friends, municipal services, etc.

[3rd&Brown]

Originally Posted by jmecklenborg

^Banks didn't count a wife's income (technically, the lower of a married couple's two incomes) toward mortgage lending until around 1970. That's why new American homes exploded in size in the 1970s and 80s.

It wasn't enforced for much longer than that tho. My mom's income wasn't considered when my parents bought their first home in 1974ish.

[mhays]

Agreed...beyond a certain size space is a problem. You have to heat it and maybe cool it. It has to be vacuumed and kept in repair. And it would feel so empty. And that giant yard might take constant maintenance. I wouldn't want a house period (seeing the vast money and time friends and family put into theirs), but a big house sounds so much worse.

[3rd&Brown]

Originally Posted by Steely Dan

well, you're looking at it through your higher income bracket lens.

for most middle class families, the choice is more like a 2,000 SF house on a tiny lot in the city or a 4,000 SF vinyl box with a huge backyard out on a cornfield.

i happily chose the former, but i have many chicagoland cousins who seem content with the latter.

that's a fair point but who needs 4,000 SF? families are smaller than they've ever been. and let's be honest, these homes are not going to appreciate in value much. when you have 6 bathrooms and the house is reaching the end of its first generation life, who's gonna remodel those 6 bathrooms? it would be cheaper to just move to another box further out.

[dchan]

My parents' condo is 1500 SF, and it feels really big already for them. There is so much space that needs to be cleaned and maintained.

[chris08876]

Originally Posted by mhays

Agreed...beyond a certain size space is a problem. You have to heat it and maybe cool it. It has to be vacuumed and kept in repair. And it would feel so empty. And that giant yard might take constant maintenance. I wouldn't want a house period (seeing the vast money and time friends and family put into theirs), but a big house sounds so much worse.

I don't think its the horror that people describe it as.

Say you have close to 4000 sq-ft of home to take care of. Somethings, are given. The living room can stay clean if you keep it clean and not throw food on the ground or just being careful if you eat there.

Bedrooms, same thing. Make the bed. If you have carpet, vacuum once every two weeks.

If you keep the space clean via daily practices, just being hygienic, even with minimal effort, its not a lot of work.

Bathrooms, depending on how many you use, clean once every three weeks. So long as one isn't a slob, its not that bad.

Not being a slob to begin with will minimize the amount of preventative cleaning or maintenance.

Dining room or guest rooms, again, cleaned in the beginning, assuming not that frequent of usage, should be easy to maintain.

It could also be how much of a clean freak one is. Some folks NEED to clean every week, due to their mental illness of OCD... but others, clean once a month because they are not slobs in daily discourse.

A 3000-4000 sq-ft house is not hard to maintain.

Now with landscaping, that's the one thing that can be annoying, so either contract it out (cutting grass, maintenance) or spend a few hours (get some exercise as well doing landscaping tasks... think of it as being in shape). People over exaggerate the big house lifestyle. Its not that complicated. I know because I have a big house. Its pretty clean and I don't slave away at it. Just about being efficient that's all and preventative maintenance and practices.

Likewise with the kitchen. Spending that extra 5 minutes cleaning the environment where one cooked can save a lot of time. Placing dishes immediately into the dish washer is a good practice. Also trying not to spill things on floor. Doing that will save hours versus someone who does none of that, waits a month and than needs 4 hours to clean a kitchen because they let it go.

And if you have a partner or wife or husband, help them out. Will speed it up. Work as a team to work less and enjoy more house and not cleaning.

[JManc]

My house is 3,000 s/f. It's not hard to maintain. We have a roomba that does its weekly rounds and the two guest bathrooms are rarely used. We have a weekly lawn service so it's basically keeping the bedroom. kitchen and master bathroom in check