Legislative proposals like this in an election year work to put candidates on record and fish for contributions.<p>It seems unworkable. The $50M threshold for hedge funds is easily circumvented by breaking up funds, and the "on any day" language makes bulk transfers tricky. "Single-family" includes 1-4 units, so all those savers who prefer real estate to the stock market could have their buyers dry up.<p>(No comment on the actual economic or fairness benefit.)<p>However, what could work this year and be even more useful would be to strip out everything except reporting requirements. The government has really no idea what's happening in the housing market or why, and no evidence that could quantify the degree of market control or indicate illegal collusion. This could be combined with anti-money-laundering reporting requirements designed to disclose real estate being used to launder dirty money, with appropriate requirements to disclose the beneficial owners, and detect the effective but unregistered sale of property by selling the owning entity. There's really no policy objection because property already must be registered, and there are no real business confidentiality concerns from the government having this information. If/since the reporting would be limited to real estate, it wouldn't raise the substantial lobbying hackles of all the other businesses relying on shell corporations, and might even garner the support of the big hedge funds seeking to scare off competition.
I’m not sure how this would work practically in the US. A huge constituency of people has most of their finances centered around their home as minimally a value store and maximally a growth investment. Having homes go down in price or even just leveling off would create a whole other host of challenges for a society that’s been organized so completely for so long around home values going up.
Putting aside whether or not discouraging investment makes sense as a strategy, it is absolutely wild that this is specific to single family homes. Apartments are unaffordable as well and they are also often owned by funds.<p>Are people who live in apartments just out of luck then? Discouraging investors from owning single family homes could encourage more speculation on multifamily homes.
Short of banning land ownership (IMHO the correct solution, since the earth belongs to all of us) they should just put large taxes on land, with some rebates if you actually live there, farm there, etc.
I'm yet to see a holistic review of housing. Yes corporate ownership is bad, I think, however the availability of land is also a problem, the cost of building, which is driven by the cost of materials and labour.<p>Arbitrarily capping one part of the problem I have doubts will help overall, and possibly make the situation worse.<p>Eg if we block wall Street investment, and could that money go into other areas and increase competition for materials and labour and make it harder and more expensive to build homes?
I believe this will eventually come to pass as the housing crisis impacts more and more families and eventually becomes an election issue. It's unlikely to happen in the first few attempts though<p>It's a bit like healthcare - the national consensus has gradually but firmly shifted in the direction of a regulated marketplace. Took a while but eventually did happen.
It’s a step in right direction to cool off demand, but the big issue is supply.<p>Make a law that building permits can’t take longer than 6 months. No nimbysm crap.<p>Permits can only be denied if the building plans don’t meet code and cause major environmental issues.<p>Also permits shouldn’t cost a fortune.<p>Permits are a huge bottleneck. A piece of paper.
Housing has been destroyed by unrestrained capitalism.<p>Capitalism without limits, without social seatbelts is a bad thing. I don’t care if this makes the pure capitalists shriek “COMMUNISM!”. In fact it’s not communism to have a society that has rules around housing, it’s healthy social democracy.<p>Housing is a fundamental human need and houses should be owned by people and every single citizen who wants to own a house should be able to buy one within their local community. Teachers, clerks, garbage collectors, <i>everyone</i>. It used to be this way before housing turned into a real world monopoly game.<p>Rich people - ie those who own one or more houses tend to be completely lacking in empathy for those who don’t own a house.<p>And people who own houses tend to have lots of advice like “move somewhere cheaper further out”, but such advice is easy to give because they never have to take such worthless and insensitive advice.<p>Singapore has 89% owner occupied housing. This should be the mission for any country that cares about its people. But modern governments don’t care about their people, they care about growth, and about making politicians and vested interests richer.
I'm for this, but it raises questions about what will happen to the millions of renters living in these investment properties. They're mostly not just sitting there empty.
This is a paper tiger. just by banning "Hedgefonds" (misnomer of the decade by the way, they do anything but hedge these days), or, more precisely investment funds structured as limited partnerships, from owning residential real estate you do absolutely NOTHING to mitigate what happened in 2008.<p>hedge funds are just an easily hated scapegoat, because they ARE insufferable in many cases, but they are not at fault here.<p>The real problem is the moral hazard that is growing exponentially with every increase in distance between the ones dishing out the money and the ones who are liable. If you can repackage mortgages into more and more complex derivatives you can sell to other people, and you also figure out a way to game rating agencies into a triple A rating by misleading them with thin-file FICO scores and faux diversification, you can profit from deadbeat customers and make someone else the bag holder at the same time. That’s the archetypal moral hazard.<p>The institutional clients don’t understand that correlation increases with volatility, they are consoled by the ratings and don’t realize they are part of a time bomb, waiting to drag the whole economy down with it.
There's a _really_ cool way to take Wall Street out of the housing market.<p>Build. Enough. Housing.<p>Enough housing means supply meets or exceeds demand which means prices fall which means Wall Street doesn't get the returns they want which means they move on to prey on something else.
Investors that buy houses just rent them out again, so the houses are not removed from the supply of housing, just moved from the homeowner's market to the rental market. There is nothing wrong with this - renters need a place to live too! The problem is the lack of overall housing, not the balance between homes to rent and buy.<p>The fact that it's profitable to buy homes and rent them out means that renters are currently overpaying relative to buyers, and shifting properties over to the rental market will help correct this inequality. If you advocate against this then you are arguing that renters should be screwed over the subsidize homebuyers.<p>If you want to screw over wall street you should build more homes to flood supply and tank the value of their investment. Of course many of the people who complain about Wall Street buying up homes are also NIMBYs who adamantly block all new housing because they are supply-and-demand deniers or vacancy truthers.