Comment by nospice
3 days ago
"Corporations" is meaningless in this context. If you want to own a rental home in the US, you should set up an LLC, both for liability reasons and because it makes it easier to deal with taxes and expenses.
In the parts of the country I lived in, I've never seen big corporations own single-family rentals en masse. They usually go for apartment complexes, which are far more profitable if you have the capital to buy / build one. Commercial real estate too.
If you click around your neighborhood, a lot of single-family homes are owned by living trusts and "Bob & Kate" LLCs, but that doesn't mean there's any hedge fund money involved.
Just to reinforce this, the last place I lived in was owned by a corporation...of one man, who lived a town away in a modest house and worked as a paper pusher by day.
The title of the article - "3 companies own nearly 38,000 metro Atlanta homes"
Metro Atlanta has a population of 6 mil, say 2/3 live in detached homes with 2 persons per home. So that's 38,000 out of 2 mil homes, so about 2%
There are well over a million homes in the metro Atlanta area. If the top three owners have less than 4% of a market, need if they act in a completely coordinated manner they have approximately zero market power.
Yes if the market is for rice, but illiquid assets are an entirely different market which can be crazy warped by a few important participants.
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> e never seen big corporations own single-family rentals en masse.
I just sold a house to a big corporation that owns about 12,000 homes. There's a whole industry for enabling these buys, opendoor, offerpad, etc... It's usually a wash selling your home as is to a wholesale deal vs. prepping your home and selling it, the difference being done about 60-90 days faster than via retail.
The company I sold to already owned four houses on my street. It's crazy.
no offence but this kind of makes you part of the problem
I could have a principle and live in a falling apart money pit in a declining neighborhood or move to a brand spanking new home in a neighborhood on the way up.
Part of the problem is how hard it is to sell a home in the first place. I'm not interested now, but for a while I was looking at needing to move states, and that was going to involve selling my home and buying (or renting) in the new location. And all the math was saying that anything other than getting really lucky with a sale just before moving was going to cost me a LOT of extra money and be a drain and a hassle on top of all of the stresses involved with moving to a completely new state.
I really hate the idea of selling to these "we'll buy your home fast" shops, but I have to be honest that had I needed to make that move, it would have been a very real possibility.
That's not really meaningless though. You just explained in more detail some attributes of corporations, many of which are precisely the things many people are criticizing when they criticize the fact that corporations own lots of housing. Of course we all know that there are still humans behind the corporations.
I've been told that, for privacy reasons, you should even buy your own home under an LLC as well
Depends on how unique your legal name is. Buying your own home as an individual creates a public record with your address and your name. This gets ingested by lots of people search websites like https://www.fastpeoplesearch.com/ (which I have used). But if your legal name is really common, it would be harder for anyone else to deduce which one is actually you.
For what it's worth, I just searched that site you linked with my name and the zip code I lived in for the first 18 years of my life, and it seems to have a pretty muddled view of who I am. It has my correct age, full legal name, and current address, as well as two of my past apartments and my address for those 18 years where I lived in the zip code I searched, but it also lists my parents current home that they bought over a decade after I had permanently left that state in a city I've never lived in. The landline number it lists is the number my parents had at the house I grew up in, but they don't even use it now, and it wouldn't have been an effective way of reaching me since I used to live at that house, and the mobile number it lists is one I've never seen in my life. For family members, it lists one of my brothers and parents, but not my other brother or either of my two living maternal grandparents, although it has a strangely long list of names I've never heard of, some of whom have my mother's maiden name but aren't my grandparents or any of my relatives with that name who I'm aware of, as well as a bunch of people whose names I don't recognize with last names I'm not aware of being in my family tree.
I'm not saying that site isn't potentially useful as a starting point to find out some stuff, but it hardly seems worth influencing a major decision like what legal entity to purchase a home with.
(edited to add): It also says there's no public record of me being married, which definitely is not the case. My wife literally co-owns and also lives in the house it lists me as living in (and has the correct purchase date for it), so you'd think that whatever algorithm is used to build the dataset would be smart enough to see if there's any other ways we're legally tied together. It also says it doesn't have any records of business associations I have when last year I registered a single-member LLC for contract work last year. The LLC literally has the same name as me followed by " LLC", because apparently no one else had registered that before in my state, which at least gives some evidence that my name isn't overwhelmingly common.
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Significantly complicates getting a mortgage though
This suggests that a single-family home is generally a bad investment. Maybe not if you're living in the house yourself (no renter-landlord inefficiency), but still idk. Could make more sense in certain areas where all the value is in the land.
It's segmented. If you don't have a whole lot of capital but want to invest in real estate, you buy a rental home or two.
If you do have a lot of capital ($100M+), you don't, because you can spend that money to build or buy an apartment complex that gives you something like 5x as many tenants per dollar spent. And is cheaper to maintain in the long haul.
Indeed. This was discussed about a month ago. My prior comment:
https://news.ycombinator.com/item?id=46208561
LLC may be a type of corporation but when people complain about corporations buying up homes they really mean C-corps, not LLCs owned by Uncle Bob who likes to flip houses.
Right, and when people share stats such as "60% of homes are owned by corporations", they're either clueless or are trying to deliberately muddy the waters.