SF startup helping to make housing crisis worse

[Eric]

Turns out that Zillow purchased a house at the end of our block at the end of the summer and are now selling it for a loss. Not surprisingly, they did not disclose themselves as the buyer on their own site, we had to get that info from Realtor.com, shady to say the least.

 

[Chew Toy McCoy]

Turns out that Zillow purchased a house at the end of our block at the end of the summer and are now selling it for a loss. Not surprisingly, they did not disclose themselves as the buyer on their own site, we had to get that info from Realtor.com, shady to say the least.

Well, in the spirit of Citizens United, a tech company is like a celebrity and should therefore be granted more privacy to protect them from the adoring or psychotic mobs.

 

[JayMysteri0]

Well you can all relax. Well, no. Now it's also investors pricing buyers out of homes

First-time homebuyers are getting squeezed out by investors

With a historic shortage of homes for sale, investors making cash offers are pushing first-time homebuyers out of the market.

www.npr.org

Record-high home prices and low inventory were already making things hard for first-time homebuyers. But new numbers show that investors are driving even more people away from homeownership.

"Investors are coming in and pushing out the first-time buyers," says Lawrence Yun, chief economist for the National Association of Realtors. He says the percentage of home sales that went to investors rose to 22% in January, up from 15% a year earlier.

Meanwhile, sales to first-time homebuyers fell from 33% a year ago down to 27% in January. Under more normal conditions, first-time homebuyers would make up about 40% of sales, says Yun.

There are a couple of forces at play. A historic shortage of homes for sale has been pushing prices higher and resulting in multiple bids on many homes. And that has given a huge advantage to investors and wealthy individuals who can afford to offer cash.

Buyers offering cash made up a full 27% of sales in January, up from 19% the year before. Sellers prefer cash offers because they're a sure thing. So, Yun says, "first-time buyers have essentially zero chance against cash buyers."

Yun says the trend is troubling.

That historic lack of supply has been steadily pushing up prices. The National Association of Realtors says that in January, the median sales price of an existing home in the U.S. rose 15% from the year before to $350,300. Over the course of last year, the typical home rose $50,000 in value.

Recently, homebuilders have been stepping up the pace of construction, which eventually may help.

"We're moving in the right direction. But I would still say that we are short by 3 or 4 million housing units in America, so we still need to ramp up supply," says Yun.

A recent Zillow report found that in 481 U.S. cities, the value of a typical home is now at least $1 million. "The number of cities that crossed the $1 million threshold in 2021 is almost triple that of cities reaching those heights in 2020, underscoring a record-setting year of home appreciation," according to the report.