[sharpy]

Probably a lot of private equity buying up homes to generate rental income? Usually, I am more pro market, but I think there needs to be some regulations on this. Although if you are an existing homeowner with low interest rate locked in, you probably want more private equity investments to drive up your property value...

[bojangleslover]

This myth needs to die. PE does not own that many homes. There was a small period in early COVID where interest rates were lower than cap rates. During this time PE, along with the investment market in general, invested in real estate including SFRs. That is no longer the case. It's a great boogeyman but trust me, having worked in the industry, institutional investors own less than 5% of SFRs.

Real estate investing in general went bananas during COVID (plenty of non-PE buyers as well) because it's one of the only ways the average citizen can access that amount of leverage.

[impossiblefork]

They might not own that many, but in 2025 it was 1/3 of the sold residencies.

You only need a little bit of extra demand to have an enormous effect on prices.

[loglog]

"Private equity generating rental income" is a lie fed you by the rich lobby. The real reason (everywhere in US and Europe) is zoning, which is a subsidy to the owners of existing buildings at the cost of everyone else.

[kiba]

Zoning change would spike land value in more populated area much more closely located to metro center, but it will depress demand on locations further away from the urban center.

[impossiblefork]

No, it isn't.

1/3 of the houses bought in the US are bought by these kinds of organizations. Zoning might matter, but large capital owners are buying up a large fraction of the houses that are for sale and this is obviously driving up prices.

[ambicapter]

And who owns those buildings?

[potato3732842]

Calling it a "subsidy for existing owners" is a slighty of hand that avoids blaming the literal hordes of useful idiots who are happy to see all manner of asinine provisions written into the zoning code to cater to their interest, whatever that may be. If it were just property owners it wouldn't have gotten done. It's busybodies, environmentalists, moralizing jerks, etc, etc that provide the necessary political will.

[pessimizer]

> The real reason (everywhere in US and Europe) is zoning

This is a lie fed to you by the rich lobby. Destroying zoning would launch the value of the land current owners have into the stratosphere.

[prescriptivist]

There's something fundamentally strange about how prices have spiked and inventory has tightened since Covid. Where I live in rural New England, prices are up 50–100% in five years. And this is on pretty poor quality homes. Yes, low interest rates led to a surge in buying and bidding wars that spiked the baseline, but when people say "the real problem is there isn't enough housing" that feels incomplete to me. Of course supply has been an issue for a while, but home prices nearly doubling in five years doesn't look like a normal supply story -- it's not as if we suddenly created 20-50% more qualified buyers in that time. I guess the lack of churn, with people hanging onto those sweet 3% mortgages much longer than usual, is probably part of it. But I really don't have an answer for the current state of home buying. I make great money but if I was to buy a house the quality of the house I got in 2018 with the same % down payment I would be looking at over 40% of my take home going to a mortgage, PMI and taxes.

[munificent]

> it's not as if we suddenly created 20-50% more qualified buyers in that time.

We don't create buyers quickly, but mobility means that a large number of buyers can show up in one concentrated area much more quickly than housing can adapt.

One piece of the US real estate puzzle is that automation and outsourced killed agriculture and manufacturing jobs. Those are the kinds of jobs that have some natural incentive to be spread across the US. Ag, because farms literally take up a lot of space and are spread out, and manufacturing because factories tend to be close to raw materials, ports, or other local resources.

When you get rid of those jobs and replace them with information work, you create a feedback loop with no dampening in it. People want to go where the most jobs are, so they move to the cities. Businesses want to open where the most workers are, so they start companies in cities.

The next thing you know, all the small towns are filled with dirt cheap empty houses because there are no jobs. Meanwhile, every metro area is bursting at the seams.

[nradov]

Prices spiked in large part because the government printed an enormous number of dollars since 2020, thus triggering asset price inflation.

https://fred.stlouisfed.org/series/M2SL

[ww520]

House value has gone up along with other assets since Covid because a lot of money have been printed. A trillion here and a trillion there, pretty soon we're talking real inflation. Real estate is the real inflation hedge.