[buscoquadnary]

Basically RE prices went through the roof and became an object of investment that gained in value during a time when money was cheap and cash was a bad place to store it.

This caused management funds, BlackRock Berkshire etc, to start purchasing the homes as investment vehicles. These vehicles then will either sit on a house or simply rent the house out at a rate that makes fiscal sense, regardless of the economic realities.

This artificially restricts supply as they take these houses off the market, they don't care if the house sits empty for years as long as they can sell it at their target price, and then at the same time causes rents to be raised as the rental prices are set by an internal ROI formula and not what the local market can bear.

[epistasis]

I can understand a small time house investor not renting out the house, and I see that all around me, in a very very tight housing market. Small time owners of 2-3 houses, especially those who have paid off the mortgage, avoid the hassle of renting because they have limited time to seek out tenants and deal with them, or limited tolerance for risk from a bad tenant.

But I can not for one moment understand a cooperate buyer not renting it out; they have more than enough capacity to rent out homes, they can spread risk across lots of properties, and any time not spent renting is merely money left on the table, which would come back to bite any manager that is leaving a lot of money on the table.

[mywittyname]

And some of those investors already lost their asses buying up SFH. I'm sure the rest see the writing on the wall. For example, BRG spun off a home trust division just this month, and it's the one that bought up all of these SFH during the boom. Could it be that they were expecting a massive drop in value of these investments?

SFH are a pretty insane choice of RE investment for institutions because they are so incredibly inefficient compared to apartment and office buildings.

[quonn]

> This artificially restricts supply as they take these houses off the market, they don't care if the house sits empty for years as long as they can sell it at their target price

Private owners would also sit it out if they can. Unless they can't. You think that's better? People having to sell at a big loss?