Comment by sokoloff
3 days ago
> Normal people are renting apartments or portions of homes.
About 2/3 of households in the US own the home they live in. Renting is the minority, not the majority.
3 days ago
> Normal people are renting apartments or portions of homes.
About 2/3 of households in the US own the home they live in. Renting is the minority, not the majority.
Thank you for mentioning this! There's this weird, persistent meme that large corporations are buying up all the housing and nobody owns homes anymore, which is fundamentally not supported by the data.
There are shifting trends in generational home ownership rates, but these are still just initial trends we're seeing. If you look at the data [0] owner occupied has gone down from the 2000s housing bubble, but in the grand scheme of things is not even particularly low.
People also have this mistaken belief that investors like Black Rock are buying up huge swaths of property, when in reality most "investment" properties are bought by families and individuals, consider anyone who know who owns an AirBNB rental or other rental property, they would be considered "investors".
Most Americans still live in a house, and own that house (or at least, some member of their household owns it).
0. https://fred.stlouisfed.org/series/RHORUSQ156N
One important data point is that houses have become much more expensive compared to income in the last decades. When I lived in CA, my plumber neighbor told me he bought his house in the 70s for 80000 on a salary of 40000. Today he would probably pay 800000 for the same house but make maybe 100000 or a little more.
It's definitely harder to buy a house these days.
Houses today are vastly larger. Cost/sq ft in all but the few most expensive places has been nearly constant under inflation adjusted price for an incredibly long time. A huge majority of the population lives in such places.
Here's a size list that is commonly shared https://www.newser.com/story/225645/average-size-of-us-homes...
When you figure in # of people in such houses, the avg person has vastly more space https://www.reddit.com/r/REBubble/comments/14hayqq/average_h...
$40,000 in 1975 is over a quarter million 2025 dollars.
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the higher prices are affected by the corporate buying of single family homes. for every home a corp buys, that's one less for individuals to buy. if the number of buyers remains the same but fewer homes are available, prices go up--seller's market. yes, prices go up adjusted for..., but inventory more competitively sought. the other issue is that the average buyer is looking to buy with financing while corps are paying cash. that makes for such a smoother transition for the seller that it is hard for them to turn down cash offers.
after corps, we have foreign buyers also coming in with cash offers. i know of one specific house that is empty for the majority of the year purchased by foreign owners specifically for their kid to live while attending college. the kid chose to not go to that school, so the house sits empty except for when some property manager comes by to "check in" on the place.
so while this thread is discussing still showing decent ownership percentages, those numbers are glossing over some of the "trends" in modern real estate.
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Interest rates have fallen dramatically over this period, which increases the ratio that is affordable.
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At 18% interest which happened in the 70s your yearly payments would have been 14468.02 or 36% of your income. A couple years ago you could get 3% rates and so your payment on that house would be 40473.98 or 40% of your income, not much difference (and likely the house is larger). At todays 6% interest the payment is 57556.85 or 57% of your income and so not affordable, but this is a very recent thing.
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A good, experienced plumber would make a lot more than that in CA.
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Sorry, there's no way a plumber in the 70s made 40K.
I don't know about the United States, but in (parts of) Europe it is the case. "Nobody owns homes any more" is an exaggeration of course, but things are not alright in the housing market, in part because private corporations are buying up quite a large percentage of the housing stock to rent. I think in Ireland it's about half.
Like I said, I don't know about the US. It's a big place and you're probably taking too much of a "grand scheme of things" view here. Aside from geographical diversity, total % of home ownership doesn't change that fast – lots of older people already own homes, their children often inherit those homes. Houses aren't like hotdog sales and numbers change slowly.
What matters more is how much does an average 25 or 30 year old pay in housing costs? What hope does someone with a decent (but not exceptionally well-paid) job have of purchasing a house? A single % of home ownership across the entire population doesn't really capture that. Doubly so for such a large country as the US. I'm sure there are affordable homes out in the sticks, but also ... no jobs. That might work for the remote software dev, but not everyone is a software dev.
In Ireland the total housing ownership has fallen, but not dramatically. However, the reality for people not already having a home is quite bleak. Buying a house now is significantly more expensive than it was a decade or two ago, as is renting. I could buy an apartment on my own ten years ago with a salary that really wasn't all that great. I'd have no hope today. My rent today is about three and a half times what it was 15 years ago. There is a generation of working 20 and 30-year old who are still living at home because they can't really afford to move out.
> "Nobody owns homes any more" is an exaggeration of course, but things are not alright in the housing market, in part because private corporations are buying up quite a large percentage of the housing stock to rent. I think in Ireland it's about half.
This is a _really_ popular meme, but it's not true. About 50% of new homes are bought by owner-occupiers, about 25% by local authorities and approved housing bodies (https://www.citizensinformation.ie/en/housing/local-authorit...), 10% pension funds and institutions (these are the 'private corporations' you refer to), and the remainder are small landlords, holiday homes etc etc.
I think sometimes people see "50% of new homes are bought by owner occupiers" and read it to mean "and thus the other 50% are bought by evil corporations" (people also tend to forget about the 'new' bit; second-hand homes are much more likely to be bought by owner-occupiers, as REITs and pension funds largely don't want to touch them, and nor do approved housing bodies; local authorities do sometimes buy individual second-hand homes, usually from private landlords), but really the bulk of the remainder is social housing.
The ridiculous rents are driven by the fact that we're just not building enough homes. Not that we're not building a lot; we have one of the highest per capital rates of homebuilding in the OECD, but there was a period of 7 or 8 years where we built almost nothing, and that's a really hard gap to bridge.
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In Ireland, approximately 41% of young adults aged 18 to 34 live with their parents as of 2024. It was 32% in 2011. This is an economic abhorration that has stolen significant independent adult lifespan from an entire generation.
This is caused by an Irish cultural distaste for apartments - as they're generally not setup for modern living, are typified by poor soundproofing and insulation, and marred by fire insulation and other scandals - leading to a decreased stock. Include the Help-To-Buy scheme applicable only to new-build houses on greenfield estates, and the HAP social-welfare payment which set an artificial floor on rents for apartments, and its the case that the average apartment rent is 1.5-2x the cost of servicing the mortgage at a 90% LTV.
This results in an average rent in Dublin of €2,500, with Open-market rents in the capital rising at annual rate of 5.2%. The most recent median (50th percentile) salary is €43,221, which comes from a 2023 CSO report. That's a monthly net salary of €3,000 per person.
The National Asset Management Agency, set up in the recession to take on all the in-default property and babysit it till prices rose again, has a huge part to play. Combine this with a non-fit-for-purpose Planning and Appeals process, and you literally have builders suing the government for blocking developments.
As of November 1st 2024, there were just over 2,400 homes available to rent across the ENTIRE COUNTRY OF IRELAND, down 14 per cent on the same date a year previously and well below the 2015-2019 average of almost 4,400.
All of this laid the foundations for disaster. Now the increased materials and energy costs since Covid-19, combined with a relative collapse in our building sector prior, have meant that building apartments in Dublin has largely become commercially unfeasible, as construction costs are now higher than what buyers are willing to pay.
https://www.independent.ie/business/unviable-construction-st...
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> I think in Ireland it's about half.
It's about 1/3rd AFAIR.
I do agree that Ireland has experienced a massive change in house prices from 15 years ago, but 15 years ago was the bottom of a bust after the boom so potentially not the right comparison point.
I do mostly agree with your points, and it's really bad but it's important to contextualise some of those points.
Yes, it’s surprised me how this meme was everywhere in the comments while the data does not support it. I’d bet it’s splashy headlines in news outlets. Important to correct it so that policy is focused on what’s most effective.
Blackrock sounds scary
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It's another example of mistaking the current trading trends for the overall asset reality. Like NFTs, TSLA, and house prices, a relatively small amount of daily trading money can move the "market cap" quite a lot.
And those old folks that took their home equity and used it to buy property for an AirBNB are in fact an example of the rich/old folks screwing the young generation hard. (Other examples: vote to reduce taxes, to increase tuition, stop the free market from building more housing, do nothing on global warming, let the economy be swallowed by health care and financialized scams). As are the people that own and rent 3 houses, while their grandkids have to move far away. (Disclaimer: I live in San Jose, and my adult kids will never be able to live near me).
> There's this weird, persistent meme that large corporations are buying up all the housing and nobody owns homes anymore, which is fundamentally not supported by the data.
They are and the trend is there. The housing market moves slowly and it takes time to chip away enough at the larger stat. Once the boomer's age out, even with wealth and asset transfer, let's revisit this and see how it looks. I'd bet 2/3 ownership looks more like 1/2 or less by then, which is a significant drop and it probably will only continue from there.
For adults under 35, less than 38% own their own home and the rate is falling.
Also, it varies quite a lot by state. Over 3/4 of adults own their own home in West Virginia, but in New York it's a bit over 1/2.
Population also varies wildly by state, and New York makes up a far larger percentage of the USA than does West Virginia.
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Owning an apartment isn’t materially different than renting an apartment here. It’s sometimes better as many apartments have free or rentable spaces available for parties as a selling point, but rarely can you use that space late in the evening.
Owning a home in an HOA area can drastically cut down on what kinds of parties you can host.
To some extent but there are differences. You have housing stability, a fixed price going forward, the ability to renovate most of the internals, and the ability to affix things to the walls without worrying about marks when you have to move out.
I don’t disagree, my comments was about the logistics of throwing a party.
Well… mostly fixed price. Property taxes go up every single year, and are now the largest single payment I make every year.
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a fixed price going forward
Property taxes, HOA fees, maintenance, appliances randomly breaking and resulting in bills of thousands of dollars...
the ability to affix things to the walls without worrying about marks when you have to move out
If you care about the sale price you will worry about that, among many other things.
But what's the demographic breakdown of this?
How many of that 2/3 is households that have owned the home for 20+ years—ie, since before the subprime crash?
How many of that 2/3 is households of people 65+? And how many is people under 30? Partying is still largely a young people's game, and even if your "household" owns the home you live in, if that's your parents or grandparents, you're much less likely to be hosting parties there.
That is severely overrepresented by old farts who don't party. Among people who party most probably rent.
yeah, as an East European, it's crazy that our real estate prices are basically the same as the non-super expensive US cities, and we make like one-fifth the salary.
In fact I just checked and the ratio of avg salary to real estate prices is about the same as in New York.
This is misleading. The trend is going in the opposite direction and the figure is closer to 53% https://www.reddit.com/r/neoliberal/comments/1ew7tp6/no_67_o...
Yeah, but the 2/3 of people are old boomers that don’t party.