In 2022, Zillow Predicts That Phoenix housing market will climb ANOTHER 20%?! (Mesa: short sale, apartments)

[john3232]

Earlier wrote: Last SFH I rented (late 2021) there were roughly 80 inquires. Rented home in 2 days.

I should add I listed it $100 under market rate. I wanted move the property fast. Pre-screened roughly 80 inquires. Ended up with 3 I wanted to show the house.

First couple took it.

[Sno0909]

If you're really concerned about climate change, you need to focus your frustrations on China.

[Potential_Landlord]

Originally Posted by hikernut

If true, in the long run very few will be able to afford housing. It’s not possible, for example, to spend more than 100% of income on housing.

Long periods of peace and prosperity have always lead to extreme distributions of wealth. For example, the long relative period of peace from the Napoleonic Wars to WW1 in Europe lead to the upper 10% in Victorian England to own 100% of all wealth including RE. Latin America which did not materially participate in WW1 and WW2 also shows very lopsided wealth inequality. Since WW2 ended we are on the same path, albeit not there yet. But one would have to be blind not to see we are fast approaching at least a 80% -tenant no ownership of anything- population.

[hikernut]

Originally Posted by Potential_Landlord

Since WW2 ended we are on the same path, albeit not there yet. But one would have to be blind not to see we are fast approaching at least a 80% -tenant no ownership of anything- population.

It can go even beyond tenant vs. owner.

If the cost of shelter grows faster than wages indefinitely, at some point the meager profit in renting to the common people will not justify such an enterprise. The wealthy will do something else with their land. Most people will have to make do with whatever shelter they can stitch together from materials they can find at little or no cost... dead vehicles, waste scraps from construction projects, tires, rammed earth, etc. No sanitation or utilities for most people.

[dontbelievehim]

Originally Posted by Sno0909

If you're really concerned about climate change, you need to focus your frustrations on China.

Let's do nothing then and give China the green economy. Good thinking.

[Potential_Landlord]

Originally Posted by hikernut

It can go even beyond tenant vs. owner.

If the cost of shelter grows faster than wages indefinitely, at some point the meager profit in renting to the common people will not justify such an enterprise. The wealthy will do something else with their land. Most people will have to make do with whatever shelter they can stitch together from materials they can find at little or no cost... dead vehicles, waste scraps from construction projects, tires, rammed earth, etc. No sanitation or utilities for most people.

Rents are a consumption good and will stay in line with wage growth. But you are correct the purchase price to rent ratio will go up ever more (corrective periods none withstanding). The calculation will shift ever more towards appreciation vs. rent yield. So the rich will stay in the RE to rent game, just for a different reason. As you have noticed, the rich (Wall Street etc.) have definitively encroached on the SFH market since the last crisis. You see massive fund buys etc. that we have not seen before. They are here to stay. We are at the point in the game where the top 10% start to gobble up SFHs for rent meaningfully. In the past they stuck to stocks and other assets, but here we are. I wish I had a better way forward but history almost singularly points to this outcome. We could look back into the Roman Empire or Renaissance-era European towns and find the same.

[MN-Born-n-Raised]

Originally Posted by Potential_Landlord

Rents are a consumption good and will stay in line with wage growth. But you are correct the purchase price to rent ratio will go up ever more (corrective periods none withstanding). The calculation will shift ever more towards appreciation vs. rent yield. So the rich will stay in the RE to rent game, just for a different reason. As you have noticed, the rich (Wall Street etc.) have definitively encroached on the SFH market since the last crisis. You see massive fund buys etc. that we have not seen before. They are here to stay. We are at the point in the game where the top 10% start to gobble up SFHs for rent meaningfully. In the past they stuck to stocks and other assets, but here we are. I wish I had a better way forward but history almost singularly points to this outcome. We could look back into the Roman Empire or Renaissance-era European towns and find the same.

I'm with you. It's tough to compete with deep pockets and as the years move on, the game is more skewed in favor of people with $$. Add in the fact there are incredible tax advantages for renting out property. On paper, landlords "lose money" or "break-even". And when they sell, their capital gains are capped at a much lower marginal tax rate (I rented out a few of my homes to vacationers and I understand the game).

Remember, https://www.businessinsider.com/cong...te-law-2021-12 At least 238 federal lawmakers are also landlords and more than 200 senior congressional staffers also own properties and land they rent across the US. If you ever wonder why nothing will change, read the supplied link.

[Potential_Landlord]

Originally Posted by MN-Born-n-Raised

I'm with you. It's tough to compete with deep pockets and as the years move on, the game is more skewed in favor of people with $$. Add in the fact there are incredible tax advantages for renting out property. On paper, landlords "lose money" or "break-even". And when they sell, their capital gains are capped at a much lower marginal tax rate (I rented out a few of my homes to vacationers and I understand the game).

Remember, https://www.businessinsider.com/cong...te-law-2021-12 At least 238 federal lawmakers are also landlords and more than 200 senior congressional staffers also own properties and land they rent across the US. If you ever wonder why nothing will change, read the supplied link.

When we look at municipal tax records across the world which in some cases survived 1000+ years, we most often find 3-4 families owning virtually all real estate in a given town or city. This is regardless of country or political system. As long as there is no cataclysmic event like the Black Death or the town gets razed to the ground by warfare. In our case the perception is distorted by WW2 which forced massive equalization via high taxes on rich, labor union strength, mass conscriptions of workers making them rare etc. But since V-Day 1945, first slowly then ever faster these effects are waning. I'm afraid we are headed to the historical norm. You are spot-on about taxation rules shifting in favor of the super-rich. That's only a part of the Great Shift moving RE ownership from masses to elites, but certainly important. Even though I personally enjoy homeownership a lot, and wish it for everyone. I'm afraid for our grandchildren it will be a pipe dream. What we are seeing in Phoenix right now is the perfect example. Massive shifts in SFH ownership towards funds, massive increase of tenant population with no hope to ever achieve homeownership. I wish I had a better solution at hand.

[Prickly Pear]

Originally Posted by Potential_Landlord

When we look at municipal tax records across the world which in some cases survived 1000+ years, we most often find 3-4 families owning virtually all real estate in a given town or city. This is regardless of country or political system. As long as there is no cataclysmic event like the Black Death or the town gets razed to the ground by warfare. In our case the perception is distorted by WW2 which forced massive equalization via high taxes on rich, labor union strength, mass conscriptions of workers making them rare etc. But since V-Day 1945, first slowly then ever faster these effects are waning. I'm afraid we are headed to the historical norm. You are spot-on about taxation rules shifting in favor of the super-rich. That's only a part of the Great Shift moving RE ownership from masses to elites, but certainly important. Even though I personally enjoy homeownership a lot, and wish it for everyone. I'm afraid for our grandchildren it will be a pipe dream. What we are seeing in Phoenix right now is the perfect example. Massive shifts in SFH ownership towards funds, massive increase of tenant population with no hope to ever achieve homeownership. I wish I had a better solution at hand.

You already said it, we just enforce it to stay instead of letting presidents like Nixon butcher it. High taxes, labor unions, etc.

Unionization is a growing movement today. Several Starbucks stores have begun the unionization process, and it’s very likely that Amazon will as well

[MN-Born-n-Raised]

Originally Posted by Prickly Pear

You already said it, we just enforce it to stay instead of letting presidents like Nixon butcher it. High taxes, labor unions, etc.

Unionization is a growing movement today. Several Starbucks stores have begun the unionization process, and it’s very likely that Amazon will as well

Every single solitary change has trade-offs. Unions do too. I see the value (net-net). Though Unions can become too powerful like here (the Ports) https://www.theatlantic.com/business...conomy/385858/ or here (teacher and other public servants making as much as when they work) https://www.forbes.com/sites/adamand...h=6176d2506129 Never mind some worthless Union workers are protected for getting fired. I can think of some PHX police that qualifies.

If we could fix some of these issues ^^, I certainly understand why some people what a union.