Secret #61 – Landlords Bought More Single-Family Houses from 2008 to 2012 than All New Single-Family Houses Built
From 2008 to 2012, nearly 750,000 new single-family houses were sold (increased supply), but at the same time, landlords bought over 1,000,000 additional single-family houses (increased demand).
The real estate industry loves to say prices are too high because builders built too few houses. They never say prices are too high because landlords bought too many houses.
If we look at a longer period of time, over the 10 years from 2008 to 2017, we see the number of single-family houses that shifted from individual and family-owned to landlord-owned was equivalent to two-thirds of all new single-family houses sold over the 10 years from 2008 to 2017. In a way, that increase in purchases from landlords used up two-thirds of all the new single-family supply over those 10 years.
Next time you hear someone say house prices are high because house builders aren’t building enough houses remember that when it comes to houses, demand can easily outrun supply and often does.
And also remember that a big part of that demand is set by government tax and mortgage policies.