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So investors buy the homes then rent them out? What’s the problem? In some asian markets investors buy homes then sit on them unused for years. That’s a proble

So investors buy the homes then rent them out? What’s the problem? In some asian markets investors buy homes then sit on them unused for years. That’s a problem.

azeirah 5y ago
It affects the housing market very negatively. These are houses that could've been bought by families and couples and so on. Instead of being available for purchase, the same people have now have to rent instead of buy. House prices rise, rent increases, common folk are struggling, investors are getting rich without doing anything. It's just meh all over.
- deleted 5y ago
  [deleted]
winkelwagen 5y ago
If that means middle income families or starters are not able to buy those houses, and the investors driving the prices up. Then yes, it’s a problem.
- keewee7 5y ago
  Why should middle income families be able to buy property in some of the wealthiest and most expensive cities in the world? There is suburbs for that.
  - bsksi 5y ago
    Suburbs? What do you think we are, Americans?
    - keewee7 5y ago
      I'm Danish and we call it "forstad". It's pretty much the same as a suburb. https://da.wikipedia.org/wiki/Forstad https://da.wikipedia.org/wiki/Forstad
      - bsksi 5y ago
        I know they exist. What I'm saying is that European cities are built around the idea of people being able to live in walking distance of... Everything. Suburbs here exist for snobs and assholes.
        maccolgan 5y ago
        Who are you speaking on behalf of?
        bsksi 5y ago
        Like everybody else who posts comments on the internet, myself. Did I give the impression I was speaking on behalf of someone else?
  - leoedin 5y ago
    The problem of inflated house prices extends to the suburbs and beyond
  - mcv 5y ago
    The fact that those cities are so expensive is exactly the problem. Those cities are healthier if they have a healthy mix of different population groups. I live in Amsterdam and would hate to see it become a rich people's ghetto, though it's definitely at risk of that happening. Maybe it already is.
  - II2II 5y ago
    Where are the people who work in those cities supposed to live? Are they expected to commute an hour a day, diminishing their earning potential and increasing their expenses? People in the wealthiest cities also tend to have access to more resources, due to the concentration and diversity of the population. Denying low and middle income families access also diminishes their potential, while diminishing the potential of cities through the reduction of diversity. At best, this sounds an argument to hold people back. At worse, it sound like an argument to push people down.
turbinerneiter 5y ago
The problem is that it gets harder and harder for normal people to own anything (build up wealth), while building wealth is the best retirement startegy there is. I myself, for example, live in a city where owning the place I live in is just barely getting in reach for me, although I am in the top 30% income bracket of my country. I therefore have to put my savings into the stock market, which is at an all time high. Maybe even a bubble. It is frustrating to see any income gain that I make being absorbed by the housing market. I work hard while others get unspeakably rich just by owning stuff. Simply put, the balance is off.
- keewee7 5y ago
  >The problem is that it gets harder and harder for normal people to own anything One of the reasons is that people insist on living and working in some of the wealthiest and most expensive cities in the world. I live a cheap town and my commute to work in the 2nd biggest city in my country is just 25 minutes.
  - iamstupidsimple 5y ago
    Mainly that's because that's where the jobs are. (Remote isn't a 100% solution, either.)
    - imtringued 5y ago
      The jobs are where the international investors are and they prefer big cities over small unknown towns.
  - lotsofpulp 5y ago
    Perhaps people’s perception of the risk of living in a smaller town is sufficient to merit the risks of higher land prices in some of the wealthiest and most expensive cities in the worlds. Namely the risk of losing your source of income in a small town and the increased probability of higher income/access to opportunities in major cities. Of course, it is a pendulum, and it is possible people’s perception swings too far towards the small town and the big city and back and forth.
csomar 5y ago
The problem is that in a globalized world, dutch homes are more attractive than, say, homes in Cairo or Sao Paulo. Investors moving money in means that home prices are no longer correlated with the local economy. A salary is no longer what determine the rent or the mortgage but rather "global" appeal to that place.
Genego 5y ago
The problem is that these investors have raised rents nationally to a point where there is no affordable housing outside of social housing (8-15+ year wait lists). And this happened in a very short time period. If I'd want a 60-80m2 apartment in the city I currently live, I'd have to pay 1000-1200+ Euro for that; three to four years ago, that would have been half. Just over the border in Germany the same apartment goes for 350-500 Euros (NRW to be specific). The housing market here feels beyond crazy. Real estate prices themselves are also exploding +10%~ month over month
- iamnotwhoiam 5y ago
  Is that because Germany had banned property investment or because supply keeps up with demand in Germany?
  - Genego 5y ago
    Germany has much better tenant and rental market protection. Real estate prices are rising rapidly, but supply does seem to keep up with demand when it comes down to renting. Population density in Germany also is only half that of the Netherlands (240 vs 508 per km2), so that also helps. If you're priced out somewhere, you always have the option to move somewhere else. In the Netherlands you don't have much of a option right now when it comes down to renting (and mostly buying as well).
  - imtringued 5y ago
    It sold social housing and stopped building more of it. If you had asked about real estate 10 years ago you'd hear about how Germany solved the housing problem.
leoedin 5y ago
A lot of these investors are 50+ year olds who've benefited from tremendous unearned wealth from their primary residence. When you own outright your main house and have paid effectively no rent or mortgage payments for decades, that surplus income makes buying a second investment property, even at today's prices, relatively easy. The extra money and demand entering the market pushes prices up. Then the renting tenants have to pay an ever increasing share of their income in rent. They never build up capital, and so can never afford to buy anywhere. This is a societal problem - home ownership means stability (to have children), commitment to an area, a willingness to invest time into improving it. When you can be cast on to the streets with a few months notice at your landlords whim, you have none of that.
throwaway-8c93 5y ago
The real problem is that governments around the developed world gave up on building affordable social housing since the 70s. AirBnB investors just highlight the symptoms.
II2II 5y ago
From my experience, the size and type of investor seem to be a factor. I have rented my entire adult life since it has some advantages (notably mobility), yet have always rented from homeowners or small-time investors. They tend to place more emphasis upon keeping their units rented and keeping good renters. Except for moving, I have only seen my rent increase once. It was a small increase and I lived in that place for many years. Contrast that to people who have lived in places with large property managers. The rent increase is automatic, even with better renters than I. I have heard substantiated stories of rent doubling. Now those renters may have been bad apples and the property manager may have been using it as a tool for eviction, but that is still a problem. It is a problem since it is used a means to bypass tenant protections. Those protections are necessary to provide housing stability. My apologies for the rant. In principle, I have nothing against investment. That said: the excessive greed of some investors, the ones that effectively push people down or out to achieve ... well, I don't know what some people are trying to achieve beyond a certain point ... is turning me away from that principle.
- cutler 5y ago
  Market investment, ie. where little new value is added, is gambling dressed up to look respectable. It's all about getting something for nothing which is the root cause of all our economic ills.
  - II2II 5y ago
    I try to be careful with how I think about these things, so I don't go off the deep end. In my mind, investment is the adding of value while trading does not add value. Both are gambling on the outcome, but investment tries to direct the outcome while trading tries to predict the outcome. In the context of housing, investment may look like a renovation to improve desirability or replacing a small number of units with a larger number of units. In contrast, trading would involve maintaining the status quo in hopes that the desirability of a neighbourhood or relative scarcity would increase the value of a property. That being said, I don't know how you would create a system of investment that doesn't create an environment for speculative trading. In would be difficult to encourage the former without a means of selling off the investment at a later date. Reducing the frequency of trading wouldn't help in the case of housing since those are long term investments to start with.

So investors buy the homes then rent them out? What’s the problem? In some asian markets investors buy homes then sit on them unused for years. That’s a problem.

azeirah 5y ago

It affects the housing market very negatively. These are houses that could've been bought by families and couples and so on. Instead of being available for purchase, the same people have now have to rent instead of buy. House prices rise, rent increases, common folk are struggling, investors are getting rich without doing anything. It's just meh all over.

deleted 5y ago
[deleted]

winkelwagen 5y ago

If that means middle income families or starters are not able to buy those houses, and the investors driving the prices up. Then yes, it’s a problem.

keewee7 5y ago
Why should middle income families be able to buy property in some of the wealthiest and most expensive cities in the world? There is suburbs for that.
- bsksi 5y ago
  Suburbs? What do you think we are, Americans?
  - keewee7 5y ago
    I'm Danish and we call it "forstad". It's pretty much the same as a suburb. https://da.wikipedia.org/wiki/Forstad https://da.wikipedia.org/wiki/Forstad
    - bsksi 5y ago
      I know they exist. What I'm saying is that European cities are built around the idea of people being able to live in walking distance of... Everything. Suburbs here exist for snobs and assholes.
      - maccolgan 5y ago
        Who are you speaking on behalf of?
        bsksi 5y ago
        Like everybody else who posts comments on the internet, myself. Did I give the impression I was speaking on behalf of someone else?
- leoedin 5y ago
  The problem of inflated house prices extends to the suburbs and beyond
- mcv 5y ago
  The fact that those cities are so expensive is exactly the problem. Those cities are healthier if they have a healthy mix of different population groups. I live in Amsterdam and would hate to see it become a rich people's ghetto, though it's definitely at risk of that happening. Maybe it already is.
- II2II 5y ago
  Where are the people who work in those cities supposed to live? Are they expected to commute an hour a day, diminishing their earning potential and increasing their expenses? People in the wealthiest cities also tend to have access to more resources, due to the concentration and diversity of the population. Denying low and middle income families access also diminishes their potential, while diminishing the potential of cities through the reduction of diversity. At best, this sounds an argument to hold people back. At worse, it sound like an argument to push people down.

turbinerneiter 5y ago

The problem is that it gets harder and harder for normal people to own anything (build up wealth), while building wealth is the best retirement startegy there is. I myself, for example, live in a city where owning the place I live in is just barely getting in reach for me, although I am in the top 30% income bracket of my country. I therefore have to put my savings into the stock market, which is at an all time high. Maybe even a bubble. It is frustrating to see any income gain that I make being absorbed by the housing market. I work hard while others get unspeakably rich just by owning stuff. Simply put, the balance is off.

keewee7 5y ago
>The problem is that it gets harder and harder for normal people to own anything One of the reasons is that people insist on living and working in some of the wealthiest and most expensive cities in the world. I live a cheap town and my commute to work in the 2nd biggest city in my country is just 25 minutes.
- iamstupidsimple 5y ago
  Mainly that's because that's where the jobs are. (Remote isn't a 100% solution, either.)
  - imtringued 5y ago
    The jobs are where the international investors are and they prefer big cities over small unknown towns.
- lotsofpulp 5y ago
  Perhaps people’s perception of the risk of living in a smaller town is sufficient to merit the risks of higher land prices in some of the wealthiest and most expensive cities in the worlds. Namely the risk of losing your source of income in a small town and the increased probability of higher income/access to opportunities in major cities. Of course, it is a pendulum, and it is possible people’s perception swings too far towards the small town and the big city and back and forth.

csomar 5y ago

The problem is that in a globalized world, dutch homes are more attractive than, say, homes in Cairo or Sao Paulo. Investors moving money in means that home prices are no longer correlated with the local economy. A salary is no longer what determine the rent or the mortgage but rather "global" appeal to that place.

Genego 5y ago

The problem is that these investors have raised rents nationally to a point where there is no affordable housing outside of social housing (8-15+ year wait lists). And this happened in a very short time period. If I'd want a 60-80m2 apartment in the city I currently live, I'd have to pay 1000-1200+ Euro for that; three to four years ago, that would have been half. Just over the border in Germany the same apartment goes for 350-500 Euros (NRW to be specific). The housing market here feels beyond crazy. Real estate prices themselves are also exploding +10%~ month over month

iamnotwhoiam 5y ago
Is that because Germany had banned property investment or because supply keeps up with demand in Germany?
- Genego 5y ago
  Germany has much better tenant and rental market protection. Real estate prices are rising rapidly, but supply does seem to keep up with demand when it comes down to renting. Population density in Germany also is only half that of the Netherlands (240 vs 508 per km2), so that also helps. If you're priced out somewhere, you always have the option to move somewhere else. In the Netherlands you don't have much of a option right now when it comes down to renting (and mostly buying as well).
- imtringued 5y ago
  It sold social housing and stopped building more of it. If you had asked about real estate 10 years ago you'd hear about how Germany solved the housing problem.

leoedin 5y ago

A lot of these investors are 50+ year olds who've benefited from tremendous unearned wealth from their primary residence. When you own outright your main house and have paid effectively no rent or mortgage payments for decades, that surplus income makes buying a second investment property, even at today's prices, relatively easy. The extra money and demand entering the market pushes prices up. Then the renting tenants have to pay an ever increasing share of their income in rent. They never build up capital, and so can never afford to buy anywhere. This is a societal problem - home ownership means stability (to have children), commitment to an area, a willingness to invest time into improving it. When you can be cast on to the streets with a few months notice at your landlords whim, you have none of that.

throwaway-8c93 5y ago

The real problem is that governments around the developed world gave up on building affordable social housing since the 70s. AirBnB investors just highlight the symptoms.

II2II 5y ago

From my experience, the size and type of investor seem to be a factor. I have rented my entire adult life since it has some advantages (notably mobility), yet have always rented from homeowners or small-time investors. They tend to place more emphasis upon keeping their units rented and keeping good renters. Except for moving, I have only seen my rent increase once. It was a small increase and I lived in that place for many years. Contrast that to people who have lived in places with large property managers. The rent increase is automatic, even with better renters than I. I have heard substantiated stories of rent doubling. Now those renters may have been bad apples and the property manager may have been using it as a tool for eviction, but that is still a problem. It is a problem since it is used a means to bypass tenant protections. Those protections are necessary to provide housing stability. My apologies for the rant. In principle, I have nothing against investment. That said: the excessive greed of some investors, the ones that effectively push people down or out to achieve ... well, I don't know what some people are trying to achieve beyond a certain point ... is turning me away from that principle.

cutler 5y ago
Market investment, ie. where little new value is added, is gambling dressed up to look respectable. It's all about getting something for nothing which is the root cause of all our economic ills.
- II2II 5y ago
  I try to be careful with how I think about these things, so I don't go off the deep end. In my mind, investment is the adding of value while trading does not add value. Both are gambling on the outcome, but investment tries to direct the outcome while trading tries to predict the outcome. In the context of housing, investment may look like a renovation to improve desirability or replacing a small number of units with a larger number of units. In contrast, trading would involve maintaining the status quo in hopes that the desirability of a neighbourhood or relative scarcity would increase the value of a property. That being said, I don't know how you would create a system of investment that doesn't create an environment for speculative trading. In would be difficult to encourage the former without a means of selling off the investment at a later date. Reducing the frequency of trading wouldn't help in the case of housing since those are long term investments to start with.