Comment by mikem170

I don't get how that hasn't had an effect on prices.

There's not enough houses on the market (zoning, and people want to keep their low-rate mortgages), there's people worried they can't afford houses (prices inflated faster than wages, rates went up), and a large amount of housing transactions (someone quoted 29% of starter homes) are being paid for by institutional investors (who can pay cash).

Wouldn't these institutional investors buying houses be "marginal consumers", kind of like the marginal producers who set the price of inelastic commodities such as oil? Seems like 29% of transactions is even more than marginal.

I assume that sellers would need to come down in price to what non-institutional buyers could afford if institutional buyers were removed from the equation.

As an aside, I'd rather see supply increased, but maybe demographics over the next decade or two will fix that problem anyways.