Why It Feels Impossible to Buy a House Right Now

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Ken and Danille McElroy discuss whether corporate landlords actually a benef to the housing market. They explore the role of corporate homebuyers, debunk common myths, and discuss the true causes of high housing costs.
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ABOUT KEN:
Ken is the author of the bestselling books The ABCs of Real Estate Investing, The Advanced Guide to Real Estate Investing, The ABCs of Property Management, and has an upcoming book: "ABCs of Buying Rental Property: How You Can Achieve Financial Freedom in Five Years." Ken is a Rich Dad Advisor.
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#CorporateLandlords #HousingCrisis #HighRents #RealEstateMarket #Politicians #HomePrices #Scapegoats #HousingSupply #RentalMarket #Investors #HousingAffordability #Inflation #RealEstateInvesting #MomAndPopLandlords #HedgeFunds #RentalProperties #FutureOfHousing

[@vincentchan5773]

one of my dreams is to own a house. After my aunt's passing, I inherited some of her portfolio and cash savings, I’m 28 with about 400k cash in savings and as usual everybody’s preaching invest, so what stocks are a good long term buy, only major purchase I intend to make is buying a home in 5years from my returns

[@Jones21554]

Lucky you, I’d buy a lot of tech stocks and Dividend portfolios with that.

[@zaree7040]

Condolences on your aunt's passing. Remember, KZbin is not a reliable source for personalized financial advice. Instead, consult a trusted fiduciary for expert guidance tailored to your specific situation.

[@cruz3076]

Same, I just use KZbin for research purposes, I run all my major investment through an investment adviser, the market is just too unstable to handle things on your own.

[@Infinitymazepa7920]

How does one reach out to a financial advisor? my portfolio has been struggling since 2022 and I’ve been holding on by the skin of my teeth.

[@cruz3076]

there are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Monica mary strigle ” for about five years now, and hr performance has been consistently impressive.She’s quite known in her field, look-her up.

[@jmaatgreen7894]

I think you're missing some foundational information. REITs are "corporate" investment strategies that make it easy to put $5K in part of a house for ROI. It's not a supply issue, unless you're talking about building materials. The growth in ADUs and land hacking are one way to avoid the cost of nursing homes for some of us.

[@ilkeryavuz4167]

Ken broke his hand from counting his monthly rent

[@kasaipreston2889]

As much as I love this channel and the content it puts out. This is information is not correct. You can’t say there’s a supply issue if major corporations and real estate investors are buying up all the single family homes, hiking up rent so they can max out roi.

[@rorythomson3439]

Ken literally talks about this around the 3 minute mark.

[@altheacbarnes2522]

yes there are still not enough housing units available, we had a border ide open the last 4 years 15 million need a place to live right now many of them are in hotels in Chi-Town and NY and the government is paying ...

[@maiaheiss2991]

@@altheacbarnes2522we don’t have to build cheap housing for them… we can make them leave. Just like we would be made to leave if we entered their country illegally.

[@altheacbarnes2522]

@@maiaheiss2991 this is not as easy as many Americans think ... ask your elected officials how it works they should know ...

[@maiaheiss2991]

@@altheacbarnes2522 It could be easy. If there were no elected officials benefiting personally from the commerce of illegal boarder trafficking and if all the UNelected officials who support it were gone…. It would be easy.

[@kipbarnhill8848]

This is ridiculous. There are two sides to supply and demand. Investors artificially add to the demand and raise prices through speculation. Corporations systematically buying up neighborhoods and using technology to inflate prices combined with historically low borrowing rates caused unnatural price increases.

[@Tkenny35]

Every market is different. At the end of the day its us people who are causing the housing price increase. I mean a seller naturally will choose the highest bidder. Thats just human nature. I live in southern cali and a house around me is average 1 mil. There was a house for sale in my neighborhood and someone came and offered the seller 1.8 mil. Way more than the appraised vale and of course the seller took that deal! But I am also an investor in East Texas and the market there is drastically different. Overall an investor cant artificially raise prices through speculation. We determine our prices based on what has sold recently for the sqft. Also, when a buyer buys using a loan(mortgage) the bank HAS to get an appraisal and if the appraisal is less than the sale amount the bank wont loan you the money or you have to come in with the difference. For example, If I sold a house for 200k and the appraisal comes back at 180k, the bank wont loan the buyer 200k. They will say hey you either come in with 20k or the seller has to drop the price 20k. The only thing speculated is the value of the house goes up over time. But if you're talking about selling a house you cant make up a price and jack it up. It has to match the current market

[@kipbarnhill8848]

@Tkenny35 of course the market will go up over time my point is large investors are inflating prices at a faster rate. Everything u said is correct for the average person even small investors. The problem is the bank doesn't treat massive investors the same way and alot of times there is no bank involvement. The average person is willing to pay what they can afford after interest, taxes, insurance, etc. The large investor can pay more for the house because the total cost of those expenses will be lower because they either have a more favorable rate or no loan or they plan to rent at a higher price. Add the fact an investor is more likely to invest into the home to raise its value quickly. This isn't bad but at scale it drives up prices. When investors buy up whole neighborhoods and drive up comps that is not natural price growth. I'm not saying supply isn't a problem or that I'm against all forms only investing (I do it) I'm saying we reached a tipping point were it became more about speculation and milking every possible dollar out of the system. Now we can't deflate the bubble without it bursting. Putting limits on large investors' ability to throw fuel on the fire prob would have kept growth much more reasonable and affordable.

[@Tkenny35]

@@kipbarnhill8848 "The problem is the bank doesn't treat massive investors the same way and alot of times there is no bank involvement. The average person is willing to pay what they can afford after interest, taxes, insurance, etc. The large investor can pay more for the house because the total cost of those expenses will be lower because they either have a more favorable rate or no loan or they plan to rent at a higher price. Add the fact an investor is more likely to invest into the home to raise its value quickly." 1. If you're talking about massive investors like institutional investors then I have no comment on that because I dont know how they operate and not to sound rude you probably dont know too so you shouldn't try to explain a situation you dont know much about just because you see on the news institutions buying up neighborhoods. 2. But if you are talking about massive investors like normal ppl who have big portfolios I can assure you the bank treats everyone the same. They see you as a number. They dont care about who you are other than the fact of how much of a risk factor you are. The large investor would not buy a house over asking just because they can and its not as simple as buying it higher than the normal person and jacking rents up. Its all based on the market still. As an investor, we look at the market and what things are renting and selling for and to see if their is value. No one whos rich buys for high and rents for high. That just isnt reality as someone in the business myself. You can only raise the value of a house quickly if you buy a junk house for cheap and fix it up and create sweat equity. Because the house is undervalued. You cant buy a nice house and raise the value quickly because the value is already turn key.

[@Tkenny35]

Large institutions also do the same data research. They have departments and analysis of growth, wage, density, etc. They use the same method as anyone else they just do it on a larger scale. They dont but high and rent high. That isnt reality overall.

[@4Xscalper]

So taxes and insurance premiums had nothing to do with "having" to increase rents? How about the need to remodel and the increased costs to do so. What you are saying is minutiae if it even existed, compared to the economic waters we all swim in.

[@shannondavis5728]

Unless y’all have been in every market in Florida the last couple of years…don’t tell me its low inventory because i deliver lots of groceries(driving 100’s of miles every month!)to all these markets and i see all the “empty” overpriced supply….and they are still building Y.T.D.!!!!!!!!!!🙄🙄🙄😳😳😳

[@Joelconway34]

I love the grounded reality of this channel!!! Retirement took a toll on my finances, but with my involvement in the digital market, $47,000 weekly returns has been life changing. AWESOME GOD❤️

[@KuramaUchiha-id1ow]

wow this awesome 👏 I'm 37 and have been looking for ways to be successful, please how??

[@Joelconway34]

Maria Angelina Alexander I really appreciate her efforts and transparency.

[@Joelconway34]

I remember giving her my first savings $20000 and she opened a brokerage account for me it turned out to be the best thing that ever happened to me.

[@amalmberg13]

This is a definition of God's unending provisions for his people. God remains faithful to his words. I receive this for my household.🙏

[@samratsai7062]

YES!!! That's exactly her name (Maria Angelina Alexander) so many people have recommended highly about her and am just starting with her from Brisbane Australia.

[@stefaniamoore4641]

I live and work in RE in Vegas. If you aren't investing in NW Las Vegas or even far north las vegas, you are missing out a huge opportunity.

[@abriyahyasha-rahla2656]

I’m Intrigued😊

[@anthonyc362]

Because for most people, it is. This is terrible because it leads to more section 8, other subsidies, rent control and everything they makes housing more expensive.

[@budala1969]

"neighbors" don't want new housing without new infrastructure as well. Builders create new homes, cash out, and leave the area with increased traffic and competition for schools, jobs, healthcare, businesses, etc.

[@investingwithquito]

I live in Billings and love investing there.

[@jackgoldman1]

Single family houses are obsolete. I can build a new house for under $10,000 but there will not be land ownership. We need to down size houses, cars, credit, debt, and counterfeiting to get cheaper houses, cheaper lifestyles. All a person needs, NEEDS, is an 8'x12' sleeping room that is CHEAP. We don't need more $500,000 houses and more $2,000 per month rentals. We need cheaper units. Government prevents this.

[@MetaPhysStore0770]

Pole barn houses with a concrete floor, are being built all over my area, people say its a great starter home in this area.

[@autumnlynn]

Hedge funds should NOT be outbidding families for homes with cash and no inspection. And then renting it back to those same families for increased prices. It's a problem. And almost always the lower priced homes that would be a target for first time owners. So they are owning a certain sector of housing. They aren't buying million dollar homes.

[@chrislaflair4484]

It's Ken making all the sense/ points here. Think he's underestimating the immigrant impact on housing and economy..12 to 29 million is alot of competition and entitlement Sharing

[@BarkleyBrooklyn]

How many houses would need to built to to lower the prices

[@redtiger7268]

That is an area specific question.

[@coolbrothergee5401]

@ken McElroy for president 🇺🇸

[@mrfaux72]

How about investors letting go of some of there properties to distribute among families, how about more condo conversions would make affordable housing to easy pain, besides adding more housing.

[@MrMobi007]

c'mon, of course the institutional buyers are affecting the market.. they can borrow money for a fraction of what the public can... can't compete.

[@craigbauer426]

Agreed. They also will mis-lead anyone that scrutinizes by citing a statistic that they own less than 3 or 5% of all homes, which is true. What they are not saying is they can own up to 30% in specific zip codes surrounding some of the top 25 cities or markets.

[@fabiobarreiros1027]

Hedge fund is a nice name - a new name - of economy estatization.

[@Aaron_R]

I disagree with Ken - Florida is overbuilding. They have built more housing in Southern Florida than people can afford.

[@Aaron_R]

Tons of people are moving to Florida but supply seems to be matching demand in Florida. Rent is already expensive though (as it should be).

[@kinnisgosha]

I think he means national data. I am assuming Florida and Austin are outliers. 😀

[@mommom3172]

What part of Southern Florida? I'm in Broward & inventory is still tight with no new construction under $1 million.

[@Aaron_R]

@@mommom3172 Fort Myers, I used to live in Palm Beach Gardens.

[@brianpuccinelli7738]

Ken McElroy for HUD Secretary!

[@mnfranklin5698]

Great idea!

[@dawnaker725]

I don't agree with the more corporations owning houses so there could be more rentals. Americans will own nothing and be happy. WEF

[@Ascending4111]

Not wall st? Lehman bros crashed the market in 2008.

[@maiaheiss2991]

So… legal citizen population has to lower their standards to accommodate illegal non-citizen population. 🤔 Cause otherwise the math shows there is enough housing. I mean, if you are a builder you want less restrictions. But if you are a home owner you want your neighborhood to stay quiet and nice.

[@TheDogKenshin]

You need to listen and translate when these people are really saying

[@dandavis9754]

I think it is comical how you blame it on "nimby", people who don't want to live in congested crime increase, not responsible for the dwelling i live in, rent areas. People attain land and pay the uber high taxes so they can separate from those problematic types. Poor people have poor ways. I just think it immoral how developers like you look upon other peoples(temporary place holders) empty land as your next project as soon as you and the lackey gov partners can manipulate them into vacating at a lower price through various types of pressure. Stop all the illegal immigration that developers promulgate for cheap labor while gaining mega momentum from PPP money and reserve the housing for the citizens that have deference as a right. I wonder if the Hong Kong stacked on top of each other model is what you really want as most of them rent enabling you to be ofo when you should be making a living by the real sweat of your brow.

[@kasaipreston2889]

“ people can’t afford homes “ Tell that too people making $100-120k a year and still aren’t able to buy a decent home. The problem isn’t people aren’t working hard enough. The problem is quite literally corporations and millionaires buying single family homes. If real estate investors stayed out of single family market I think we would see a massive shift in the market for the good. How can a person or couple possibly go against corporations and/or billionaires with cash offers to buy their first home. This video is such bs

[@DanceMusicNature]

Usually I listen your videos.I sold my CA home.I am thinking of investing my money for rental properties.I am thinking of buying a multi-family home in Alabama, South Carolina, or Tennessee. Can you tell me which state is good for buying rental properties?

[@ryanwright1994]

Tennessee is good to invest in, but so is Alabama. TN has some of the cheapest property tax in the country. My .02 cents

[@JackT-nn8iy]

Fortunately here in FL the crash has just begun. Inventory is now at a 10 year high! Prices are just starting to come down. 2025 homes will be on sale. Patience buyers wait a little longer!!

[@mommom3172]

It is definitely specific to certain areas which is good. Real estate was local prior to the pandemic. Broward County is still a seller's market with very little new construction so very limited supply.

[@JackT-nn8iy]

Right on! Here on the space coast inventory has skyrocketed! Putting pressure on prices, which is a good thing long term. Our prices here doubled from 2020 - 2023 (not sustainable gains). I do believe sellers will have to give back appx 20% to 30% of those gains from the “bubble”. Our inventory is at a 10 year high and climbing!

[@dandavis9754]

I think greedy developer/government coluder types are the problem, In favor of rentals so that you can be OF0 100% of the day like all the other people that want to be landlords. You create a living circumstance that prohibits a large portion of the population from owning a house and having a backyard so their kids don't have to hang out with the pedophiles at the city park. The renters struggle to gain any equity while the rent prices/housing prices continue north. The whole scheme is intentional to keep people as a commodity. "The point of the system is what it does". The christians have this scripture that says" in my fathers house are many mansions. Maybe it should be rewritten to say' in my father's house there are many high-rise congested rentals. I'm sure that would really motivate us to try harder to get to heaven.

[@topshothotshot666]

Poor immigrants are takin er homes! Where I live companies have come in and bought a huge amount of homes to rent out. I'm not sure this video is as accurate as you guys feel.

[@renaissance17]

Immigration does indeed prop up real estate prices, not through purchases but through rentals. They do need somewhere to live

[@ionstaicu128]

How do you calculate the housing supply ratio. What i nolice the economic cycle dictates supply also so which one is it. My opinion is just a sell tool .

[@louaimajor7070]

curry Kamala is proposing a 5% rental cap that is a problem

[@sciencespotter]

Markets are made are the margins. If you have a never ending stream of Monopoly money bidding up homes (even if 3-5% of sales), price will just keep climbing. An issue is pretty obviously corporate home buyers, among others

[@rossferguson5786]

K&D…great show as always. I’m a huge fan of the show. I’m from Arizona and spend the summers in CdA myself. You 2 seem like you would be in the Hayden Lake area. Playing golf :-)

[@sudhirpatel1851]

Video volume is too low

[@DanceMusicNature]

Thank you for giving us knowledge

[@dawnaker725]

Oh and we need less government working with corporations This is a major problem. It's called fascism Look at how well the government did with homelessness. They threw a ton of money at homelessness and it didn't get very far. Now we have tent cities. Everytime the government gets involved it gets worse. I do agree with too many regulations Also I've owned airbnbs for the past 9 years. There are many overwatered markets. Hosts aren't making what they were a few years ago. I do think you will start seeing a sell off in areas with too many airbnbs. It will sort itself out. We don't need more regulation against airbnb. When hosts lose money they will sell RFK IS AWESOME! The Dems did him dirty too

[@dhowto3005]

Thank you Mr. McElroy & Mrs. McElroy. My subdivision has ~600 homes in it. They're starting to build ~1200+ homes adjacent to my subdivision. smh.

[@EliteClinicalResearch]

What’s her name?

[@liamfoster8057]

Janet Yellen

[@JimCasler]

22:20. Amen!

[@jeffreymassey5541]

The problem is they keep on building 'Unaffordable Housing" this "ish" has got to stop. Affordable housing is what is needed.

[@Panda_J1]

Over regulation has made it expensive to built. NYC always has a new law of things that are required. Every new law is added tot he cost because that’s what NYC requires.

[@beatdown3361]

Sure they are Apartments are more affordable There you go

[@Hawk2phreak]

Where the F do you live lol? I'm a landlord and I'm saying that lol. Rents are eating up a massive chunk of people's annual take home. It's not "affordable" in most places. ​@@beatdown3361

[@tonymartucci7097]

Build too much expensive housing and it’ll become affordable

[@altheacbarnes2522]

how will they build affordable housing when the cost of building materials is high, the interest rates for construction loans are very high, and the politicians especially demoncrats increase regulations-( tax)which resulting higher costs.

[@rcarloz]

The government can't allow supply to hit the market just like that because doing so would stagnate house prices and slow down the economy. The FED made a huge error this time and now we are paying the consequences. The sad part is that most likely the FED is making another "mistake" by not lowering interest rates on time.

[@redtiger7268]

The FED is not going to lower rates by an meaningful amount for years. The FED has done the numbers they need sales to just increase by about 3% nationally to keep the churn going for bank lender to remain solvent. We are in for another 5 years of pain. They would rather have a very long slow bleed instead of quick pain and than a long period of recovery and prosperity.

[@carlo6912]

Corporations owning SF HOMES is a good thing, got it. Thanks bozos...

[@MikeJarvis1]

That’s interesting. So all that needs to happen is incentivize (subsidize) builders aka supply ? (not corruptly, hopefully) Smart of RFK politically to pick this issue up

[@joshs2733]

What are people going to do if they can't blame something outside of the market??!!?? LMAO

[@stressfreemusic6926]

25

[@stressfreemusic6926]

29.10

[@vcracing]

I live in the south and the average home price just reached an all new high this month and it's showing no signs of slowing down.

[@MikeM247]

Are Americans having too many kids or are there too many people coming here from other countries? Why is there a shortage?

[@sudhirpatel1851]

We need rent control all USA

[@jbrandonporter]

This is a terrible idea. The ONLY thing that all economists agree on is that price controls create massive problems and only bring about abysmal quality until the controls are lifted, then we get huge price spikes far greater than we would have seen without the controls ever having been put in place. It's also one of the few areas where we actually have years of data (nearly a century) and market comparisons to back this up. It sounds good from a political standpoint, but when put in practice it hurts the very people that it's intended to help.

[@allenmandy7602]

If you control the rent, other things need to be controlled as well like tax increases, insurance increases. These things should not be able to go unchecked like they have been. Regarding taxes… taxes are suppose to be in place for street lights, roads, ect. Who thought it was ok to go up on taxes just because a house rose on price. Everyone wants their cut for nothing.

[@altheacbarnes2522]

in cities where there is rent control, there is an increase in homelessness. You should place yourself in the builder's or the landlord's shoes and see how rent control impacts you. Rent control does not work, it works for most communists who like it when the masses suffer...

[@dawnaker725]

No rent control! We need less control! Less government

[@altheacbarnes2522]

@@dawnaker725 Amen someone gets it! Free Market is what works and benefits the masses, not Fascism or Communism!