For those who might think I’m being hard on real estate investors, they’re missing the point.
I am an investor
I’m always looking to buy an investment property
I help a lot of people buy investment properties in areas that I think are high return and lower risk 1/
I'm very pro real estate as an investment
Not just because it's my business today, but because I grew up in a real estate owning family and it's what I know best
That being said, here's what some are missing when I talk about a high number of investors in Toronto's market 2/
There are investors in every market and depending on the market, there is usually some optimal number/share of investors.
I don't know what that number is and as far as I know there's no consensus on what it might be 3/
But if we have too many investors, if they become the dominant buyers in the market, then this can amplify the boom and bust cycles in the housing market. 4/
So when I talk about the risks of an investor driven market, I'm talking about the risks that Simsek, Kindleberger, Shiller have all written about
And when I talk about curbing investor demand I'm talking about reducing the risks of these amplified booms and busts /6
I mean moving back to whatever the "optimal" level of investor demand is where investors aren't having an outsized impact on house prices and are contributing to much needed rental supply.
I don't know what that balance is, but we are nowhere close to it /
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Rob was friendly and did his best to convince me that my understanding of their business wasn’t accurate
He even offered to share more info including video testimonials of their happy “owner-residents” with the hope I might change my mind and see what they are doing is great 2/
I gave it some thought.
Researching Key’s business model is not a top priority for me right now but I did figure Poloz deserves a fair shake.
So I followed up with them to say I only needed one thing, the contract owner-residents sign with Key. 3/
"our analysis finds that many Canadians are buying homes as investment properties—that is, in addition to their principal residence—and the importance of this phenomenon has grown.
Expectations of a capital gain can make homes a very attractive asset for investors." 2/
"A sudden influx of investors in the housing market likely contributed to the rapid price increases we saw earlier this year.
In such a case, expectations of future price increases can become self-fulfilling, at least for a while." 3/
The biggest lie policy makers are telling us is that the reason people can’t afford a home is because their NIMBY neighbours are preventing homes from being built.
This person has been spamming me with this same nonsense for a week, so let’s explore it 1/
The duplicitous money hungry realtor is of course an easy target, but I feel @cbcmarketplace didn’t ask any agents what it’s like working with FSBO sellers to get a different perspective.
Since defending realtors will lead to some trolling, I’ll start with a reminder that I was one of few people in my industry who supported FSBOs being listed on the MLS back in 2010 and fought with the @CompBureau to make sold data public 2/
Now, I’ll offer you my experience dealing with For Sale By Owner (FSBO) sellers from when I was selling more actively.
The first and biggest problem was that it was incredibly hard to schedule an appointment to see FSBO properties. 3/
A 🧵 on how real estate investors impact the housing market and why policy makers should be more concerned.
While there is no single cause for high house prices, real estate investors can have an outsized impact on the way up and down….1/ movesmartly.com/articles/are-i…
Avg home buyers & real estate investors have very different (heterogeneous) beliefs about the future direction of the housing market which affects their behaviours and leads to very different market outcomes
When prices are rising, real estate investors are more optimistic that prices will keep rising rapidly in the future which is why investors are typically willing to pay more for a property than an end user. 3/