A big Wall Street firm is betting that America is likely to become the United States of Renters.
On Thursday, private equity behemoth Blackstone announced a major merger of its own Invitation Homes Inc. with another company, Starwood Waypoint Homes. It's the kind of news that makes most people's eyes glaze over. But after the deal is done, Invitation Homes will be America's biggest landlord of single-family homes, owning more than 82,000 houses, mostly in major cities like Chicago and Miami.
In plain speak, this means a top Wall Street company and a top real estate company think there's a lot more money to be made renting property to Americans who either can't afford to buy or don't want to become homeowners.
The company [SOLiD] moved into the Sunnyvale space just four years ago, excitedly touting the space then as its new U.S. headquarters and a place to grow. In an interview, an executive cites the Bay Area's expensive real estate as one reason for the move to Texas.
The Southern California pattern is similar to what’s happening throughout the nation. A National Association of Realtors survey found home sellers had lived in their homes for nine or 10 years in recent years, said NAR Chief Economist Lawrence Yun. Historically, the average was six to seven years. “It’s not a California issue,” Yun said. “People nationwide are staying in their homes longer.”
California’s rent control movement, strongest in the late 1970s and early 1980s, is again gaining steam as the state faces an extreme housing shortage that has led to skyrocketing rents and rampant tenant displacement. State officials call it an unprecedented crisis, exacerbated by the erosion of state and federal funding for low-income housing development. Activists are launching new rent control campaigns up and down the state, from Sacramento to Pacific to Glendale.
Despite the frequent portrayal of long commuting as the norm, only 2.2 percent of the nation’s workers travel 90 minutes or more, one way to work. Moreover, that long commuting is concentrated in and near just a few combined statistical areas (CSAs), the larger the larger metropolitan area definition that combines adjacent metropolitan areas like Bridgeport-Stamford with New York, San Jose with San Francisco and Riverside-San Bernardino with Los Angeles. Figure 1 shows that 17 of the 25 metropolitan areas with the largest share of 90-plus minute commuters are in or adjacent to just four combined statistical areas (CSAs). . . . None of this is surprising, considering that each of these markets is plagued by urban containment land use policies that force up house prices. Harvard research indicates that domestic migration is being driven by the differential in house prices and people have been leaving the New York, Washington and San Francisco CSAs for other parts of the country. Seattle has done better, simply because its expensive housing is still a bargain compared to the much more onerous house costs in coastal California, from which migrants are being drawn.