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Comment by colpabar | Hacker News Reader

We do need more housing, but what’s stopping these same investors from buying it all up?

They are only buying it up because prices are rising so fast. More housing would mean more stable home prices, which makes the sector less attractive to investors.

No, they’re buying them up because rates are so low it costs them little to borrow/buy.

They wouldn't be buying houses if houses weren't an appreciating asset. Let's change that.

Just to be clear, we shouldn't throw the baby out with the bathwater. Houses can and should be appreciating assets. However, their rate of return shouldn't be as astronomical as they are at present. In inflationary environments, money will always flock to real estate. That shouldn't change.

The goal of increasing supply is to lower returns to such a point that they remain attractive to first-time buyers but are suboptimal for the institutional investor.

Why should houses be an appreciating asset?

Cars are an expensive depreciating asset, and the car economy works just fine.

You still haven't given a reason why they should be appreciating assets.

Supply and demand. Keep building. It works for Tokyo.

Tokyo had a massive real estate bubble driven by speculation. It’s also seen weak population growth in the recent past, so it’s unclear whether it can be generalized.

That's the thing, we just keep building and selling to them, and then we take that money and build more. Eventually they'll run out but the state is never going to run out since it can just make more money.

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