alt Hacker NewsI don’t think it’s an unreasonable assertion in the first place. Just because they are holding a small portion of all houses doesn’t meant they can’t have a huge effect. The primary reason being that the portion of houses on sale is small as well. Another reason being they are huge institutions with tons of money, and thus can hold houses longer, buy houses are higher prices, influence related markets, etc.
Replies
the numbers I have seen suggest that institutional investors own about 500k of the ~100M residential properties in the US. Small investors probably own about 15M in total. Roughly 2M units are for sale, so even if every single institution-owned unit was for sale they wouldn't be able to exert much influence. The fact that this is a big, complex and widely distributed market IS the reason they can't distort it like they do with specific industries in a given geography.
> Just because they are holding a small portion of all houses doesn’t meant they can’t have a huge effect.
There's no reason to believe that someone owning a tiny portion of the houses is setting the market price.
> they are huge institutions with tons of money, and thus can hold houses longer, buy houses are higher prices, influence related markets, etc.
No huge institution is willing to lose enormous sums of money waiting for vacant overpriced houses to sell.
I've lived in many houses. One was in a development, and I wanted to sell it. There were several houses in it that were vacant and for sale with no offers in the previous year. I sold mine in 3 weeks. It was simple - I priced it properly, and I didn't have to pay another year of taxes, insurance, repairs, maintenance, and worry, only to have to lower the price anyway to get rid of it. A couple of the other homeowners were angry with me about that, but that was their problem.