Small investors owning between one and five properties hold 87% of single-family homes owned by investors, while those owning six to 10 properties hold another 4%. Large institutional investors owning 1,000 or more properties account for just 2% of all investor-owned homes.
Honestly, I thought the large institutional investors held a much higher percentage. I am in no way saying that home prices, supply, and landlords don’t suck butt, so don’t come at me. It is weird to consider someone owning a single property as an investor. I really want to see what the numbers are like if you take out the 1 or 2 property owning people.
The way institutions structure their portfolios, most “owners” are 100-500 units. Doesnt mean those portfolios don’t roll up under one umbrella. Many institutions structure their portfolios in ways too difficult to track and count, which is why you never see count of actual doors included in these metrics. Just the same % mentioned year over year over year, meanwhile year over year they continue to purchase an ever increasing % of market share.
I’ve known a few people who own a second home as an investment in a high cost of living area. For them, it is just another way to invest that doesn’t involve the stock market.
The returns can be a little lower, but you don’t have to pay capital gains when you sell your primary residence. So, the no-tax financial move is to move into the rental when you want to downsize or leave and sell the primary residence. Then, you either live in your downsized and paid off rental as your residence or you wait two years and sell that residence as your new primary residence to get out of paying capital gains on your rental.
Another phenomenon I’ve heard is buying a house and renting it until a kid comes of age to move into it, to give them a fair shot at reasonable housing in a market that just goes mad.
Another facet of “renting” to your kid is that if they get divorced, the inlaw has no claim to the house, so it won’t get caught up on dividing the property. So it can be a subtle way of protecting your kid’s living arrangement without being overtly skeptical of the relationship.
My landlord is essentially investing in the house I’m renting. I don’t think she makes a whole lot on rent, but the value of the house has definitely gone up a lot. Rent is quite a bit below market a this point and she could raise it a lot more than she does every year ((legally, anyway)). As far as I know, this is the only property she rents out, but I do assume she owns her residence.
Honestly, I thought the large institutional investors held a much higher percentage. I am in no way saying that home prices, supply, and landlords don’t suck butt, so don’t come at me. It is weird to consider someone owning a single property as an investor. I really want to see what the numbers are like if you take out the 1 or 2 property owning people.
The way institutions structure their portfolios, most “owners” are 100-500 units. Doesnt mean those portfolios don’t roll up under one umbrella. Many institutions structure their portfolios in ways too difficult to track and count, which is why you never see count of actual doors included in these metrics. Just the same % mentioned year over year over year, meanwhile year over year they continue to purchase an ever increasing % of market share.
I’ve known a few people who own a second home as an investment in a high cost of living area. For them, it is just another way to invest that doesn’t involve the stock market.
The returns can be a little lower, but you don’t have to pay capital gains when you sell your primary residence. So, the no-tax financial move is to move into the rental when you want to downsize or leave and sell the primary residence. Then, you either live in your downsized and paid off rental as your residence or you wait two years and sell that residence as your new primary residence to get out of paying capital gains on your rental.
Another phenomenon I’ve heard is buying a house and renting it until a kid comes of age to move into it, to give them a fair shot at reasonable housing in a market that just goes mad.
I know someone renting a second house to their kid. I don’t know the full arraignments of what is going on with that, though.
Another facet of “renting” to your kid is that if they get divorced, the inlaw has no claim to the house, so it won’t get caught up on dividing the property. So it can be a subtle way of protecting your kid’s living arrangement without being overtly skeptical of the relationship.
My landlord is essentially investing in the house I’m renting. I don’t think she makes a whole lot on rent, but the value of the house has definitely gone up a lot. Rent is quite a bit below market a this point and she could raise it a lot more than she does every year ((legally, anyway)). As far as I know, this is the only property she rents out, but I do assume she owns her residence.