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submitted 1 year ago* (last edited 1 year ago) by TheGiantKorean@lemmy.world to c/nostupidquestions@lemmy.world

I see a lot of expensive houses being built in my area. A LOT. And the weird thing is that they're being bought pretty quickly. Are these people just making more money than me? If so, what are they doing for a living? Or are they just living house poor? How exactly are they affording these places?

Edit: For reference, my neighborhood is starting to become popular (because the other popular neighborhoods have priced most people out of affording places there). The normal price of newer homes here is $700k. My home, built in 1965, which is 2500sq ft on a quarter acre of land, is $500k.

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[-] RickRussell_CA@lemmy.world 0 points 1 year ago

The “investors” are the buyers/customers, and they aren’t reselling these houses–they’re renting them out.

Renting them out is still selling them, just another kind of selling. The company can only charge rent if there is a renter willing to pay. Again, the buyer determines price -- if rent is too high, there will be no renters.

[-] leadore@kbin.social 1 points 1 year ago

Renting them out is not selling, it's an ongoing income source for the owner. The renter does not determine the price when the alternative is to move elsewhere or live out of your car. There's simply not enough housing--supply is limited. It's not a simple equation like a factory adjusting the output and price of its widgets. If things were as simple as you say, there wouldn't be such a severe housing crisis in the US. Just search for US housing crisis, there are thousands of articles explaining what's going on.

this post was submitted on 14 Aug 2023
141 points (96.7% liked)

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