Business & Finance BlackRock attempting to monopolize housing

[Bear Ribs]

In order: so what? That's barely a fraction of a percent of US housing. It's a non issue.

They aren't trying to control the entire US housing market, they're controlling a few key areas in a few cities. You don't have to own the entire desert, just the watering holes.

As for zoning laws, yes, but that's the zoning laws preventing people from getting housing, not the company. Without the company, it's still impossible to buy in those places.

Yes, but lobbyists are the ones getting the zoning laws put into place. Zoning laws don't write themselves. People and companies push them, pretending that it's the law's fault is blowing smoke over the source of the problem.

Billions is nowhere near enough to affect the US housing market. The NY state housing market alone is $2.5 Trillion. They are multiple orders of magnitude away from being able to do anything.

2020 U.S. Housing Market Gains Were Biggest in 15 Years

/PRNewswire/ -- U.S. housing gained nearly $2.5 trillion in value in 2020 -- the most in a single year since 2005, according to a new Zillow® analysis. The...

www.prnewswire.com

You're seriously stuck on the idea that a company has to influence the entire US market at once to do anything aren't you?

Right here I'm pretty sure you are wrong. Depreciation as a tax thing isn't needed anymore (it's a stupid idea to begin with) as of the Trump tax plan. Instead losses work more sensibly as all expenditures are losses now instead of phased in over years.

And using housing as a tax shelter isn't smart. You pay taxes on housing to the local municipality, at the very minimum.

In short, there's no conspiracy, just a company out for money as a shield vs inflation.

No. Depreciation is still a thing in the Trump tax plan, in fact, it was greatly expanded.

I'm not even sure what you're imagining the word "conspiracy" means in this context, regardless of their strategy they're obviously a company working to make a profit. We're discussing how, the "conspiracy" here is that they're buying up housing in specific areas, allowing them to get a monopoly in key neighborhoods and cities and we're seeing abusive practices in those areas, this isn't in dispute as it's specifically spelled out in the sources above. What makes it irritating (and perhaps a bit conspiratorial) is that they're using taxpayer money to do it.

 

[Bassoe]

Also, guess who used to work for Black Rock and is probably still heavily invested with them? The same guy behind the Century Initiative, aka, the 'charity' who want to add 62.41 million people to the Canadian population by 2100.

Mark Wiseman - Wikipedia

en.wikipedia.org

Or in other words, simultaneously trying to monopolize the supply and drive up the demand.

 

[PeaceMaker 03]

I know nothing about this until today, but the first thing that comes to mind, with the bump in price paid is to boost neighborhood housing prices.

My guess is they bought tons of properties at pennies on the dollar, and or a major business is moving to that area. Has to be some driver to buy up property.

The only thing bothering me is that Blackrock received bailout money. A company made billions in profit receives tax $$$$$. While here in my state the same thing going on for companies with billion-dollar profits, but over 30% of small businesses are gone, and unable to get help.

 

[Abhorsen]

Yes, but lobbyists are the ones getting the zoning laws put into place. Zoning laws don't write themselves. People and companies push them, pretending that it's the law's fault is blowing smoke over the source of the problem.

No. The people who get housing zoning laws put into place usually aren't lobbyists, although that is everyone's (including mine) favorite beating horse.

The people who are for housing zoning laws are almost always a combination of anti-gentrification activists (who are very local, so calling them lobbyists is iffy despite my distaste for them), assorted NIMBY's, and local homeowners concerned about their housing prices (and in the past racists who didn't want blacks living nearby).

Now restaurant zoning? Sure, you have a point.

You're seriously stuck on the idea that a company has to influence the entire US market at once to do anything aren't you?

Even a metro area they have nowhere enough money to do more than a drop in the bucket. The NYC metro area alone was over $3T. Others were also large. Black Rock's total investment? Only $60B. Unless you have evidence they are only buying in one city, this is a nothing burger.

No. Depreciation is still a thing in the Trump tax plan, in fact, it was greatly expanded.

... That's sorta what I said. The complicated depreciation calculation over years mostly
gone. It's immediately expended now (as it should be), which means that depreciation over 20 odd years isn't a thing anymore. There's no complicated tax stuff going on.

I'm not even sure what you're imagining the word "conspiracy" means in this context, regardless of their strategy they're obviously a company working to make a profit. We're discussing how, the "conspiracy" here is that they're buying up housing in specific areas, allowing them to get a monopoly in key neighborhoods and cities and we're seeing abusive practices in those areas, this isn't in dispute as it's specifically spelled out in the sources above. What makes it irritating (and perhaps a bit conspiratorial) is that they're using taxpayer money to do it.

The word conspiracy is being brought up because believing that this is part of some plan to stop people buying homes is absurd. They simply have nowhere near enough money.

On top of that, them effectively bankrolling builders (which is what buying above market from builders does to rent), just finances more house creation. And even if they only offer renting, that still lowers the prices of nearby houses as renting and home buying are substitutes, so an increase in the quantity for one drives up the quantity for the other.


No, the reason for this is simple: They want inflation proof safe investment, which can't be offered by bonds right now because of the low interest rates.

 

[Cherico]

I know nothing about this until today, but the first thing that comes to mind, with the bump in price paid is to boost neighborhood housing prices.

My guess is they bought tons of properties at pennies on the dollar, and or a major business is moving to that area. Has to be some driver to buy up property.

The only thing bothering me is that Blackrock received bailout money. A company made billions in profit receives tax $$$$$. While here in my state the same thing going on for companies with billion-dollar profits, but over 30% of small businesses are gone, and unable to get help.

There was a political realinment the democrats are now the party of the rich.

People are slowly figuring that out.

 

[LordsFire]

There was a political realinment the democrats are now the party of the rich.

People are slowly figuring that out.

The Democrats have been the party of the rich for decades.

Now people are starting to actually figure that out.

 

[Captain X]

In order: so what? That's barely a fraction of a percent of US housing. It's a non issue.

As for zoning laws, yes, but that's the zoning laws preventing people from getting housing, not the company. Without the company, it's still impossible to buy in those places.

Are you intentionally missing the part about this company (and probably others like it) having people in government and thus influence over making such laws?

 

[Abhorsen]

Are you intentionally missing the part about this company (and probably others like it) having people in government and thus influence over making such laws?

They got people in the wrong government though. The feds have little control over housing laws. They'd need local power to change those laws.

I'm going to need a lot more evidence and significantly more money before I call this a problem.

 

[Rocinante]

They got people in the wrong government though. The feds have little control over housing laws. They'd need local power to change those laws.

I'm going to need a lot more evidence and significantly more money before I call this a problem.

It's certainly a problem for people in the area who want to buy homes...

These people got bailout money while average Americans suffered, and now they're buying up all the homes so that those same people can't.

Yeah, it's shitty.

 

[Battlegrinder]

It's certainly a problem for people in the area who want to buy homes...

These people got bailout money while average Americans suffered, and now they're buying up all the homes so that those same people can't.

Yeah, it's shitty.

I've yet to see evidence that Blackrock's actions have actually decreased net housing supply, or even the local housing supply on areas they're buying in.

I'd also point out that average Americans did get support from the government, and if you're following the debate over unemployment benefits, it's been argued that they got too much support. It's not quite honest to imply that wall street got help while main street was left to fend for itself.

 

[Rocinante]

I've yet to see evidence that Blackrock's actions have actually decreased net housing supply, or even the local housing supply on areas they're buying in.

I'd also point out that average Americans did get support from the government, and if you're following the debate over unemployment benefits, it's been argued that they got too much support. It's not quite honest to imply that wall street got help while main street was left to fend for itself.

We spent trillions of dollars, and half of that unemployment probably went to criminals

While billions went to companies like this, who clearly don't need bailouts if they're buying entire neighborhoods worth of houses.

What evidence do you need that buying entire neighborhood's worth of houses for far more than they're worth is bad for prospective homebuyers? it's pretty obvious.

This is hurting regular homebuyers, and it's backed by their own tax dollars.

 

[Abhorsen]

It's certainly a problem for people in the area who want to buy homes...

These people got bailout money while average Americans suffered, and now they're buying up all the homes so that those same people can't.

Yeah, it's shitty.

Getting bailed out is wrong, yes. But first, I haven't seen evidence they are targeting any particular town (not neighborhood, town). And until I see that evidence, no, they aren't even a local demand shock, let alone a problem.

But although this may hurt homeowners now, in aggregate it likely helps, as any demand shock won't last, but will lead to an increase in supply, and an increase in builder companies. Also, focusing on just current homebuyers is wrong. This helps current homeowners, renters, and future homebuyers.

As per usual, the best option is not to screw with the market anymore than it has been already.

 

[Battlegrinder]

We spent trillions of dollars, and half of that unemployment probably went to criminals

May have, according to one estimate. You're investing that report with far more certainty this is warranted, which is an issue because it undermines your larger point. IE:

While billions went to companies like this, who clearly don't need bailouts if they're buying entire neighborhoods worth of houses.

This is factually untrue at multiple points.
1. This has been ongoing for years now, it's not a recent thing from the covid relief overspending. The OP linked to several articles, most of which are several years old.
2. None of those articles state that single firms are buying up entire neighborhoods.
3. Sayimg that a firm must not have needed a bailout if they're able to invest lots of money is a not logically sound, it's akin to saying "hey, that guy who said he needed money because he was broke was obviously lying, because after I gave him money I saw him buying food!"

evidence do you need that buying entire neighborhood's worth of houses for far more than they're worth is bad for prospective homebuyers? it's pretty obvious.

This is hurting regular homebuyers, and it's backed by their own tax dollars.

None of the article suggest that Blackrock's actions are driving down the overall housing supply or that they'rebuying homes above their market value (in fact, they explictly say otherwise), so to start with I'll saying the evidence I need is literally any evidence that your claims have a founding in actual reality.

 

[Rocinante]

Getting bailed out is wrong, yes. But first, I haven't seen evidence they are targeting any particular town (not neighborhood, town). And until I see that evidence, no, they aren't even a local demand shock, let alone a problem.

But although this may hurt homeowners now, in aggregate it likely helps, as any demand shock won't last, but will lead to an increase in supply, and an increase in builder companies. Also, focusing on just current homebuyers is wrong. This helps current homeowners, renters, and future homebuyers.

As per usual, the best option is not to screw with the market anymore than it has been already.

I'm not suggesting we screw with the market.

I'm just saying they're being shitty and it's been enabled by bad policy.

Policy changes to fix it (other than axing zoning laws if they exist in the area) probably will make things worse.

But the bad policy is already done. We can't exactly go back now.

 

[Bear Ribs]

Getting bailed out is wrong, yes. But first, I haven't seen evidence they are targeting any particular town (not neighborhood, town). And until I see that evidence, no, they aren't even a local demand shock, let alone a problem.

Then you didn't read the sources in the OP with facts like "Now controls 90% of an entire ZIP code in Atlanta."

But although this may hurt homeowners now, in aggregate it likely helps, as any demand shock won't last, but will lead to an increase in supply, and an increase in builder companies. Also, focusing on just current homebuyers is wrong. This helps current homeowners, renters, and future homebuyers.

Only if zoning and building regulations don't futz with the possibility of building new houses, which they do, and which you keep trying to end-run around every time it's brought up. To whit:

No. The people who get housing zoning laws put into place usually aren't lobbyists, although that is everyone's (including mine) favorite beating horse.

The people who are for housing zoning laws are almost always a combination of anti-gentrification activists (who are very local, so calling them lobbyists is iffy despite my distaste for them), assorted NIMBY's, and local homeowners concerned about their housing prices (and in the past racists who didn't want blacks living nearby).

Now restaurant zoning? Sure, you have a point.

First let's look at the definition of Lobbyist:

• n. A member of the lobby; a person who solicits members of a legislature for the purpose of influencing legislation.
• n. One who frequents the lobby or the precincts of a legislature or other deliberative assembly, with the view of influencing the votes of members.

So yeah, the people you mentioned are lobbyists. I don't have a lot of patience for wordgames like you're pulling here.

Of course, we can also look and see if Blackrock is lobbying for building codes.

BlackRock Inc Lobbyists

BlackRock Inc spent $1,940,000 lobbying in 2021. See the lobbyists it hired.

www.opensecrets.org

So Blackrock is throwing scads of cash at Rich Feuer Anderson...

Real Estate & Land Use Lobbying Profile

Lobbying profile for Real Estate & Land Use

www.opensecrets.org

Which in turn is a lobby that handles real estate and land use lobbying...

Real Estate & Land Use Specific Issues

Lobbying profile for Real Estate & Land Use

www.opensecrets.org

And the first entry under their issues includes permitting, also listed is lobbying for the home rental industry, and they also have multiple lobbies operating in individual counties to influence local officials. Hmm...

Even a metro area they have nowhere enough money to do more than a drop in the bucket. The NYC metro area alone was over $3T. Others were also large. Black Rock's total investment? Only $60B. Unless you have evidence they are only buying in one city, this is a nothing burger.

My my, you just happen to pick the single most high-priced metro on the entire continent and ignore things like the OP links including buying up entire ZIP codes in other, more affordable towns. And a cabal of several companies can do a lot more than a single one.

... That's sorta what I said. The complicated depreciation calculation over years mostly
gone. It's immediately expended now (as it should be), which means that depreciation over 20 odd years isn't a thing anymore. There's no complicated tax stuff going on.

No. From my posted link:

The new law keeps the general recovery periods of 39 years for nonresidential real property and 27.5 years for residential rental property.

Are you even reading anything people post here?

 

[Captain X]

They got people in the wrong government though. The feds have little control over housing laws. They'd need local power to change those laws.

And you think they don't have that? I'd argue that it would actually be easier for them to do so at a local level.

 

[Battlegrinder]

Then you didn't read the sources in the OP with facts like "Now controls 90% of an entire ZIP code in Atlanta."

Atlanta has 41 zip codes, which vary enormously in size. There's one area, zip code 30363, that covers only 1/3 of a square mile, while another encompasses more than 20. Saying that someone controls 90% of one zip code out of forty one proves literally nothing.

 

[Bear Ribs]

Atlanta has 41 zip codes, which vary enormously in size. There's one area, zip code 30363, that covers only 1/3 of a square mile, while another encompasses more than 20. Saying that someone controls 90% of one zip code out of forty one proves literally nothing.

You do realize this was answering his claim that "we don't know they're targeting any specific town?" But if you want better, the next paragraph includes this tidbit:

Blackstone established Invitation Homes ... By 2017, two major players, Invitation Homes and American Homes 4 Rent, controlled nearly 60 percent of the market.

Reading the sources is going to be more useful than nitpicking individual sentences I pull out. There's no reason I should have to reproduce the entire article line-by-line on this site to answer nitpicks one-by-one on the previous sentence I used when the full context is available in the original link.

 

[Battlegrinder]

You do realize this was answering his claim that "we don't know they're targeting any specific town?" But if you want better, the next paragraph includes this tidbit:

Blackstone established Invitation Homes ... By 2017, two major players, Invitation Homes and American Homes 4 Rent, controlled nearly 60 percent of the market.

Reading the sources is going to be more useful than nitpicking individual sentences I pull out. There's no reason I should have to reproduce the entire article line-by-line on this site to answer nitpicks one-by-one on the previous sentence I used when the full context is available in the original link.

The issue is these articles are vague and aren't providing sufficient detail to back up the claims people are making. They bought 90% 0f the homes sold in one suburb, out of an unknown number of total homes in that surburb. They control 60% of "the market"....which market? All real estate? Rental properties? Single family rental homes?

 

[Rocinante]

The issue is these articles are vague and aren't providing sufficient detail to back up the claims people are making. They bought 90% 0f the homes sold in one suburb, out of an unknown number of total homes in that surburb. They control 60% of "the market"....which market? All real estate? Rental properties? Single family rental homes?

the article actually says they bought 90% of the 7500 homes in one zip code