Hacker News new | ask | show | jobs
by nradov 1880 days ago
Median incomes are irrelevant to housing developers. All that they care about is whether there are enough customers to buy their products. The developers typically don't lend to customers so the only risk is that demand might collapse in the middle of a project. A lot of small developers went bankrupt during the last recession because they had borrowed to build new projects and then couldn't sell the completed homes.

The federal government wouldn't really be able to prevent REITs from buying up homes.
2 comments
ericmay 1880 days ago
> The federal government wouldn't really be able to prevent REITs from buying up homes.

Why wouldn't it? If this was bad enough the government could just pass limitations on it. Hell, the government could probably ban REITs overnight if that was wildly popular.

link
pbronez 1880 days ago
If you want to support individual home ownership against well-capitalized REITs, I think you basically need local governments to impose some kind of vacancy tax and/or an non-owner-occupancy tax. Otherwise individuals will never have the financial firepower to keep up.
link
sokoloff 1880 days ago
If that's your goal, you should also support the mortgage interest deduction (to put owner-occupied borrowing on the same footing as commercial borrowing) and the deductibility of state/local real estate taxes on your federal return (for the same reason).
link
throwaway0a5e 1880 days ago
Even if the industry is unpopular there's not that much appetite for legislatively killing it at the drop of a hat because everyone knows that's not a good precedent to set.

More realistic would be substantially increased taxes on non-primary residences.

link
jgalt212 1880 days ago
> Median incomes are irrelevant to housing developers.

That's a bunch of horse hooey, as the customers in all housing markets (outside of a few global cities) are all local. Median income + credit conditions = how much buyers can afford.

> The federal government wouldn't really be able to prevent REITs from buying up homes.

Of course not, but no matter what kind of black magic Blackstone is weaving, they cannot get a more than a trivial number of people to rent a 3BR apt for $10K / month (approx price for nice 3BR in Manhattan). Once again, the population's median income is the driver.

link