Contrarian view for real estate ownership. Life long investor.

[Rich Weese]

I have been involved in real estate for nearly 50 years and have always been very positive about the future. I started at a very young age buying real estate and investing in more and more as decades went by. If I was young and starting out today, I would not have the same positive outlook that I had previously. Still heavily invested in real estate and not acquiring more at the present time for various reasons.

I hope I'm wrong for the future sake of generations to come but here is my reasoning currently. Please feel free to join in the discussion and state your arguments as to why I am wrong.

1. It was very easy to purchase real estate when I was young especially using FHA and VA methods. These homes were also fully assumable and led to easy transfer ability for residents and investors. That has changed considerably now.

2. Young people were going to college for degrees and graduating with unlimited opportunities for job placement. They were also graduating for the most part with no debt, making a payment for a home mortgage much easier. That has also changed now removing many buyers from the pool of potential homeowners or investors. Financial institutions and government regulations have also made acquiring multiple homes more difficult. It was easy for me to acquire tens of homes and then hundreds of homes but now that would be nearly impossible. It also seemed much easier to find a starting job position with ability to grow in that trade or occupation. Much of that has now been replaced or will be replaced by AI.

3. Young people were also getting married with the possibility of both people working and qualifying for a mortgage at still relatively low price real estate. That has also changed now, with a large percentage of occupants being a single individual and also waiting longer to have children or deciding not to have children at all. I have six children and the most any of them have is three. ( see next item)

4. Re- population rate has continued to drop. Due to infant mortality, the necessary reproduction rate to replace the population is 2.08. The United States rate has continued to drop and is currently at 1.73. It doesn't take high education math to determine there will be a surplus of properties available to live in with this continuation in population reduction. Just take a look at Japan. There are now 8.5 million vacant homes in Japan and more than one in 10 vacant in the city of Tokyo. A simple Google search will show there are actually homes being given away for free in live in condition. Their birth rate has dropped to 1.44 over the past several decades and that is compounding their problem exponentially.

5. Rental rates may be less than paying your own mortgage now. Rather than just comparing the rent to the mortgage, it becomes necessary to add property taxes, insurance, maintenance, landscaping etc. The renter does not have these expenses to add to the rental rate and it is much easier to qualify for as a single individual or to share a home without major qualification necessary.

I'm sure I am leaving out many additional items that should be of concern. I have not even discussed the extreme increase in prices to purchase or construct a home with no stop in sight.

I'm well aware this is an investment site with tremendous interest in the real estate area. I'm probably one of the older posters on bigger pockets and have seen many ups and downs and changes in particular areas. I have lived in seven different states and have purchased real estate in even more that I guess I am just suggesting caution currently. As the government runs out of options for tax seen the population, the mortgage interest deduction will be looked at more and more seriously. If you did not have that deduction, would you still purchase real estate investment property?

Bring on the discussion and shoot your arrows!

Rich Weese

[Mitchell Jaworski]

Love the perspective from someone that has been in the game for such time.  I'm kind of in the middle here age-wise and see alot of what you talk about with the younger generations.

The less homeowner demand I felt has helped rental demand, but this could have an expiration date given the re-population rate you discuss.  Based on those stats we may not need much new home building going on.  The irony is new homes aren't even being built, it seems to many be condos and apartment buildings which creates many more units than homes.  Atleast in my area that is all they are building.

All of it is food for thought and there is nothing wrong with analyzing the risk in an investment.  That should be done with any asset class.

I've continued to invest and probably still will, but an rather picky and also invest in other non-traditional assets classes.

[Jay Hinrichs]

Rich I think its regional.. right now for instance in the Portland market rents and mortgages are about the same.

and for those that bought a few years back they are lower than rent.. 

I see the point though in markets like much of fly over country were there is excess inventory and vacant homes all of the major metros in those areas have thousands of vacant homes..  and historic none appreciating markets.. the ONLY thing propping up those markets is investors refurbishing exiting homes for rental purposes.. simply because you can buy and renovate those homes for far less than replacement costs.

and much of what happens of course is demographic shifts IE flight to suburbs but we are now seeing a reverse of that in areas were commute times are so bad  ( Atlanta )  and or the millennial buyer who just wants to uber and not own a car.

Things you and I probably don't have much of a concept for..  IE how we live and how the younger generation is living But its back to the future.. I mean even in the 60s when I would go visit my grandparents in Milwaukee.. there was the corner store.. corner Pub  Friday night fish fry.. most of it walking distance. 

Walk score is now a huge deal in our market here in Portland.. not sure in places like Texas were its so BIG and spread out. I have to think they have urban cores as well..

[Ricardo Lopez]

Good points, but let me poke some holes. 😊 

• Young people now are more interested in purchasing real estate than they were 40 years ago. I never had that in my priority list when I was in my early 20s – I feel that that has changed. 
• More single individuals pursue homeownership today; especially women. My son bought a house with his girlfriend when they were both in their 20s. That was not socially acceptable just a couple of decades ago. 
• I also have 6 children, but my oldest (now 39) has 4. What you say about family size is true, but it varies greatly within different cultural/ethnic groups. 
• In terms of population growth, you need to combine the growth as a result of births, with that of immigration. 
• Also, people are living a lot longer now, which increases the need for housing.

[Rich Weese]

@Jay Hinrichs

It seems like many of those Uber millennial's not only don't want to own a car but do not want to own a house either. They seem to prefer the freedom of movement with as few attachments as possible. There is also no corner store, corner pub or local hardware store or any of the other places we used to frequent and our kids got their first jobs. Now much of that is being replaced by AI with more to come in the near future. I personally see an oversupply of property and under supply of qualified buyers.

@Ricardo Lopez

I think your arrows were very well pointed! Here are some thoughts point by point of your five points.

1. Maybe this is an area thing. I have bought and sold a lot of real estate and I have not seen a great deal of millennial's interested in buying a home. I have not seen the large change that you have.

2. I think the reason more single individuals are pursuing homeownership is because there are so many single individuals. In my younger days, it was get a job or go to college and get a degree, find a woman to marry and buy a house and start a family. I'm not sure those are the norm today.

3. I'll bet you know many more people whose kids have fewer children than the parents then vice versa. I agree it varies in cultural/ethnic groups as I am a member of one of the largest providers. ( Mormon or LDS)

4. Excellent point and many of those immigrants believe in larger families.

5. The study I read about Japan showed the the older people were no longer living in their houses. I live in the number one retirement community in the world (The Villages) with over 125,000 retirees making it their home. However, I have not seen a study recently of how many of those are living in care centers and other types of housing for older population. I can assure you there is tons of that type of housing being built within our area.

I appreciated your arrows and feel they were explained very well and all are Extremely relevant.

[Jay Hinrichs]

Originally posted by @Rich Weese:

@Jay Hinrichs

It seems like many of those Uber millennial's not only don't want to own a car but do not want to own a house either. They seem to prefer the freedom of movement with as few attachments as possible. There is also no corner store, corner pub or local hardware store or any of the other places we used to frequent and our kids got their first jobs. Now much of that is being replaced by AI with more to come in the near future. I personally see an oversupply of property and under supply of qualified buyers.

@Ricardo Lopez

I think your arrows were very well pointed! Here are some thoughts point by point of your five points.

1. Maybe this is an area thing. I have bought and sold a lot of real estate and I have not seen a great deal of millennial's interested in buying a home. I have not seen the large change that you have.

2. I think the reason more single individuals are pursuing homeownership is because there are so many single individuals. In my younger days, it was get a job or go to college and get a degree, find a woman to marry and buy a house and start a family. I'm not sure those are the norm today.

3. I'll bet you know many more people whose kids have fewer children than the parents then vice versa. I agree it varies in cultural/ethnic groups as I am a member of one of the largest providers. ( Mormon or LDS)

4. Excellent point and many of those immigrants believe in larger families.

5. The study I read about Japan showed the the older people were no longer living in their houses. I live in the number one retirement community in the world (The Villages) with over 125,000 retirees making it their home. However, I have not seen a study recently of how many of those are living in care centers and other types of housing for older population. I can assure you there is tons of that type of housing being built within our area.

I appreciated your arrows and feel they were explained very well and all are Extremely relevant.

actually in my day job  IE new home construction I sell 80% of my new homes to millennials  its not my experience that they don't want to own homes.. they may delay but the second they start family that changes.. and also they are not brain dead they know renting is throwing money away..  :)

there are turn key operators in Japan.. you can buy rentals there for 30 to 50k that meet the 1% rule or more.. they will live there a life time and you have next to zero issues with those tenants compared to the US tenant base.. they are respectful of authority.. 

just look at pictures of fukishima and NO looting no rioting. all lined up nicely to get water.. then look at pictures of New Orleans during Katrina.. it was a free for all blood bath on many levels..   

[Syed H.]

Originally posted by @Rich Weese:

@Jay Hinrichs

It seems like many of those Uber millennial's not only don't want to own a car but do not want to own a house either. They seem to prefer the freedom of movement with as few attachments as possible. There is also no corner store, corner pub or local hardware store or any of the other places we used to frequent and our kids got their first jobs. Now much of that is being replaced by AI with more to come in the near future. I personally see an oversupply of property and under supply of qualified buyers.

@Ricardo Lopez

I think your arrows were very well pointed! Here are some thoughts point by point of your five points.

1. Maybe this is an area thing. I have bought and sold a lot of real estate and I have not seen a great deal of millennial's interested in buying a home. I have not seen the large change that you have.

2. I think the reason more single individuals are pursuing homeownership is because there are so many single individuals. In my younger days, it was get a job or go to college and get a degree, find a woman to marry and buy a house and start a family. I'm not sure those are the norm today.

3. I'll bet you know many more people whose kids have fewer children than the parents then vice versa. I agree it varies in cultural/ethnic groups as I am a member of one of the largest providers. ( Mormon or LDS)

4. Excellent point and many of those immigrants believe in larger families.

5. The study I read about Japan showed the the older people were no longer living in their houses. I live in the number one retirement community in the world (The Villages) with over 125,000 retirees making it their home. However, I have not seen a study recently of how many of those are living in care centers and other types of housing for older population. I can assure you there is tons of that type of housing being built within our area.

I appreciated your arrows and feel they were explained very well and all are Extremely relevant.

 The only reason millennials haven’t purchased a home is because they can’t afford it. I’m a millennial. Everyone in my group of friends who doesn’t own already, aspires to own.

The issue is everyone is riddled with high student debt and where they want to buy has become even more affordable.

The issue I see happening is urban vs rural/suburban RE market. Younger people especially want to live in an urban environment. Even in suburbia, they want to live near the Main Street and walk to a bar or train station. Not sure there’s a long term future for middle of nowhere real estate. 

[Rich Weese]

@Jay Hinrichs

Okay, here we go again. I believe we have opposite viewpoints in regard to college and this is going to be another area where we have differing viewpoints.

1. Brain-dead if you rent rather than own. This is not 100% accurate. You would still have that down payment to use for some other purpose: start a new business make a different type of investment etc. The money wouldn't just disappear because it was not used to purchase a home. In many areas and at many different times, it was not advantageous to buy a home and people actually lost money. You are aware of that.

2. I am aware of the turnkey operators in Japan. That still doesn't explain why there are so many vacant homes available for free or nearly free in 10% of Tokyo is vacant. Evidently, the investors are not sold on the prospect for those would not be sitting vacant and increasing annually. I'm not sure I understand whether the 1% rule makes any sense are not in Japan currently. You would still need to materialize prospective tenants out of thin air. They must be living somewhere currently and would create that they can see if they moved into one of the already vacant homes.

3. You will never get an argument from me on the difference between respect of authority in Japan compared to our current situation in the United States.

I have no problem with the current investment atmosphere but if we continue to suffer many of the same foreign problems and increase those problems with reduction of tax write off or exceedingly high values of homes, I don't see it getting fixed.

Rich

[Jay Hinrichs]

Originally posted by @Rich Weese:

@Jay Hinrichs

Okay, here we go again. I believe we have opposite viewpoints in regard to college and this is going to be another area where we have differing viewpoints.

1. Brain-dead if you rent rather than own. This is not 100% accurate. You would still have that down payment to use for some other purpose: start a new business make a different type of investment etc. The money wouldn't just disappear because it was not used to purchase a home. In many areas and at many different times, it was not advantageous to buy a home and people actually lost money. You are aware of that.

2. I am aware of the turnkey operators in Japan. That still doesn't explain why there are so many vacant homes available for free or nearly free in 10% of Tokyo is vacant. Evidently, the investors are not sold on the prospect for those would not be sitting vacant and increasing annually. I'm not sure I understand whether the 1% rule makes any sense are not in Japan currently. You would still need to materialize prospective tenants out of thin air. They must be living somewhere currently and would create that they can see if they moved into one of the already vacant homes.

3. You will never get an argument from me on the difference between respect of authority in Japan compared to our current situation in the United States.

I have no problem with the current investment atmosphere but if we continue to suffer many of the same foreign problems and increase those problems with reduction of tax write off or exceedingly high values of homes, I don't see it getting fixed.

Rich

well there are only a certain type that start business.. and lets take the 400k new build I sell.. FHA loan 3.5 % down plus closing cost so they get into a home for 20k.. hard to start a business with 20k.. payments are equal in this market to rent.. same house rents for 2500 plus.. they get the write off. ( which of course we need.. like you said that goes away and that spells trouble. ) salt is already bad enough for high priced markets. but tax's would be full write off.. and historic appreciation. Plus stable base.. there is a reason millions of new homes sell each year.. Public wants them.. There is more new construction in Tokyo than there is in many other high priced cities like SF and other areas.. I am / was in the timber business in the NW west and sent LOTS of logs to Japan over my career.. so have a little bit of understanding.. not an expert.. plus when you say a home. in Tokyo that could be literally a 50 sq ft little box LOL literally.

[Rich Weese]

I thought there would be more input and attacks with this subject. I think I'll just let it die. I did almost purchase a retirement home in Summerlin 25 years ago and know how expensive it is and would assume lake Oswego, Oregon is the same thing. I have never invested in the expensive areas such as those.

I know it's working well for you.

Rich

[Syed H.]

Comparing the US to the Japan isn’t really fair. Culturally, we are very different. New construction actually sells pretty well in Japan. Older properties do not. There are a bunch of Asian superstitions that contribute to this. A much more fair comparison would be Western Europe. 

[Jay Hinrichs]

Originally posted by @Syed H.:

Comparing the US to the Japan isn’t really fair. Culturally, we are very different. New construction actually sells pretty well in Japan. Older properties do not. There are a bunch of Asian superstitions that contribute to this. A much more fair comparison would be Western Europe. 

one of my partners brother is a major builder in Tokyo his company is listed on the front page of the stock exchange.. they have been building non stop for the 15 years I have known them.   

[Paul T.]

Originally posted by @Jay Hinrichs:

Rich I think its regional.. right now for instance in the Portland market rents and mortgages are about the same.

and for those that bought a few years back they are lower than rent.. 

I see the point though in markets like much of fly over country were there is excess inventory and vacant homes all of the major metros in those areas have thousands of vacant homes..  and historic none appreciating markets.. the ONLY thing propping up those markets is investors refurbishing exiting homes for rental purposes.. simply because you can buy and renovate those homes for far less than replacement costs.

and much of what happens of course is demographic shifts IE flight to suburbs but we are now seeing a reverse of that in areas were commute times are so bad  ( Atlanta )  and or the millennial buyer who just wants to uber and not own a car.

Things you and I probably don't have much of a concept for..  IE how we live and how the younger generation is living But its back to the future.. I mean even in the 60s when I would go visit my grandparents in Milwaukee.. there was the corner store.. corner Pub  Friday night fish fry.. most of it walking distance. 

Walk score is now a huge deal in our market here in Portland.. not sure in places like Texas were its so BIG and spread out. I have to think they have urban cores as well..

 Jay, do you think some of these tertiary markets are doomed? I do see a trend of ambitious, young professionals moving away to major metropolitan areas. There are simply more good jobs and opportunities for them. In tertiary markets, I suppose you still have the medical professionals (nurses, doctors, etc) and law offices that do well. Then small businesses like restaurants. 

I'm just trying to imagine what some of these small cities will look like in 10-20 years.

[Evan Parker]

Originally posted by @Rich Weese:

I have been involved in real estate for nearly 50 years and have always been very positive about the future. I started at a very young age buying real estate and investing in more and more as decades went by. If I was young and starting out today, I would not have the same positive outlook that I had previously. Still heavily invested in real estate and not acquiring more at the present time for various reasons.

I hope I'm wrong for the future sake of generations to come but here is my reasoning currently. Please feel free to join in the discussion and state your arguments as to why I am wrong.

1. It was very easy to purchase real estate when I was young especially using FHA and VA methods. These homes were also fully assumable and led to easy transfer ability for residents and investors. That has changed considerably now.

2. Young people were going to college for degrees and graduating with unlimited opportunities for job placement. They were also graduating for the most part with no debt, making a payment for a home mortgage much easier. That has also changed now removing many buyers from the pool of potential homeowners or investors. Financial institutions and government regulations have also made acquiring multiple homes more difficult. It was easy for me to acquire tens of homes and then hundreds of homes but now that would be nearly impossible. It also seemed much easier to find a starting job position with ability to grow in that trade or occupation. Much of that has now been replaced or will be replaced by AI.

3. Young people were also getting married with the possibility of both people working and qualifying for a mortgage at still relatively low price real estate. That has also changed now, with a large percentage of occupants being a single individual and also waiting longer to have children or deciding not to have children at all. I have six children and the most any of them have is three. ( see next item)

4. Re- population rate has continued to drop. Due to infant mortality, the necessary reproduction rate to replace the population is 2.08. The United States rate has continued to drop and is currently at 1.73. It doesn't take high education math to determine there will be a surplus of properties available to live in with this continuation in population reduction. Just take a look at Japan. There are now 8.5 million vacant homes in Japan and more than one in 10 vacant in the city of Tokyo. A simple Google search will show there are actually homes being given away for free in live in condition. Their birth rate has dropped to 1.44 over the past several decades and that is compounding their problem exponentially.

5. Rental rates may be less than paying your own mortgage now. Rather than just comparing the rent to the mortgage, it becomes necessary to add property taxes, insurance, maintenance, landscaping etc. The renter does not have these expenses to add to the rental rate and it is much easier to qualify for as a single individual or to share a home without major qualification necessary.

I'm sure I am leaving out many additional items that should be of concern. I have not even discussed the extreme increase in prices to purchase or construct a home with no stop in sight.

I'm well aware this is an investment site with tremendous interest in the real estate area. I'm probably one of the older posters on bigger pockets and have seen many ups and downs and changes in particular areas. I have lived in seven different states and have purchased real estate in even more that I guess I am just suggesting caution currently. As the government runs out of options for tax seen the population, the mortgage interest deduction will be looked at more and more seriously. If you did not have that deduction, would you still purchase real estate investment property?

Bring on the discussion and shoot your arrows!

Rich Weese

A quick look at my post history and you'd see I LOVE thought process posts like this. 

As someone who doesn't have nearly the experience of you, and is in that younger generation I'll give my take on your points.

1. I can't speak to how easy it was for you in the past getting a loan, but in my experience and in my circle of family and friends, the FHA loan system that we have in place sometimes makes it too easy for people to get a house from what I've witnesses. In a sense that because someone can "afford" the low down payment the FHA allows, they wind up in entirely way too much house for their income and ultimately screw themselves. As far as property transfer laws, from what I've read and talked to family about, you're 100% correct. People still find ways to get around that though, but I've yet to personally reach that stage in my investment career so I can't speak to that. 

2. Hit the nail on the head here. I can't add much more to this. Student loan debt is definitely a crisis and is impacting the economy in ways many people can't even imagine. 

3. This ties in with #2 very heavily, a lot of people want to have children, but when your finances and life is so royally screwed that you can hardly afford, rent, a social life, and are struggling to find a career that is satisfying...it definitely pushes off the natural flow of when people would want to have children and buy a house. 

4. This has actually peaked my interest. I'll have to look more into these figures and how that actually impacts the nation and population. I can see this tying into #2 & 3 though. I have a theory that with more of the world at peoples fingertips, more people want to "experience" the world before settling down/having kids/buying a house...or they may even decide, through their trekking through the world...that they in fact don't want ANY of those things. In the past, the knowledge and ability to access what was "out there" was not nearly to the level that it is today. Often that resulted in many people staying where they grew up, dating who they went to school with, living near the city they were raised in, and not really being exposed to much else unless they had a natural curious mindset. As people become exposed to more, the status quo of what life should be/how it should look shifts dramatically. 

5. In major cities rental rates are definitely cheaper than trying to buy, but honestly not by that much. The prices are pretty much getting neck and neck. A lot of people choose to rent because of my answer to point # 4, the sense of freedom and the ability to "pack up and go" as they please. Combine that with the answers to #2 and #3 and you have a strong case to just keep on renting. You wanna see the world, you don't have money to really buy one of those expensive houses, you don't need the space for a house, you're not even sure if the job you really like is even in this city.

Great post and I'm glad I had the chance to give some input. Thanks for letting us into some of your thought processes. 

[Michael P.]

Dont worry about the birthrate.

If current trends continue, the population of the United States will rise to 438 million in 2050, from 296 million in 2005, and 82% of the increase will be due to immigrants arriving from 2005 to 2050 and their U.S.-born descendants, according to the Pew Research Center.

[Warren Lanza]

What a great post Rich!   Some may see it as negative i see it as big picture, real world questions.

I'm just a decade or so behind you i would guess Rich, and live in Florida in involved in real estate investment since a child as my Mom owned rentals and was a Real Estate agent.

From your bullet points

1. Easier to purchase real estate before. I bought my first house in 1982. My friends that served in the military had great VA loans 0% down that were assumable. What you didn't mention was the interest rates. My mortgage was 14% on an adjustable! Remember Inflation? Those assumable VAs were gold if you could find them but you had to have the balance in cash and FHA required larger down payments, 10% min if i remember on FHA.

The US Government has a huge hand in balancing the housing market and since it is central to our Economy (see 2008) they do there best to keep it hopping.  I'm sure they will screw it up again but the next bunch will balance it out.  If you are in long term housing will likely reflect the health of the US economy.  Housing Appreciation has slightly outpaced Inflation since WW2.  (case-schiller)

2. AI replacing a huge chunk of jobs.  Yea, maybe.  I really don't know what to say about that.  Basic Income?  Such a huge set of unknowns like predicting what computers would do to the world in the 1950s. Another unknown is what will Global Warming do to prices?  Florida homes are 50% state insured because our state government has allowed insurers to cherry pick.  Katrina in Miami could bankrupt the state. 

3.  Reducing Family size.  As others noted this is kind of a slow problem nationally with immigration and many ethnic groups still having larger families.  Also, the number of people per home and people per sq ft has gone down as fewer people have to squeeze together in small houses.  This also varies by location and demographics.  I always reference this when the "good old days" arguments come up about housing, cars, etc.  It wasn't the same product.  Homes were smaller with far fewer features.

4. Central to all this is the question of will resi home demand increase for the next say, 30-40 years.   I believe it will, as always be a local question.

Although Millenials are not buying homes as quickly per the press, stats say homeownership as a % of the population peaked around 2004, dropped in the melt down and is trending back up.  It's actually pretty flat since the 70s.  THe government has a lot to do with this as when they pumped it up with the no/down - no/qualify loans in 2002-2007

Here is a chart.

https://dqydj.com/historical-homeownership-rate-in...

I also found it interesting that our ownership % is very small compared to much of the world. China is 95%!  We are 41st at 64.5% in 2014, way behind most of Eastern Europe.  Lot's of room for growth if the Government decides to push it.  Curious what the rental market in the countries ahead of us is like. I'm sure many have huge restrictions and regulations on landlords as many are former/current Communist countries.

My analysis after this interesting exercise is as always...Real Estate is hyper local.   I'd love to own in Austin or Denver  at 2008 prices, less so in Detroit.  They built the villages where you are because land was cheap.  There is still a lot of reasonable land in that area.

The big question to me is if not real estate then what?

The attraction to real estate is of course leverage and also your ability to control/improve the property and run it fully or semi-passive.  I can't  improve Stocks, T Bills, or Gold or Collectibles and i have no control.  I can't run most businesses passively either and finding one i can leverage is another challenge.

In every business transaction someone wins and someone loses at least partially.  (occasionally it works out for both evenly).  In real estate at least you have some control.

My belief is real estate will nationally echo the health of the US economy and local demand will be driven by many factors.  That said, i'm sure there are thousands willing to bet the other way.

Great thoughtful post Rich.  Thanks

[Pat L.]

Very interesting article on AI in REI...or is it REI-AI

http://fortune.com/longform/single-family-home-ai-algorithms/

[Trey Burns]

Thank you for the wisdom and challenge to think @Rich Weese. I can't speak to all your points, but will say one thing. The younger generation is thankfully seeing through the biggest marketing scheme of all time: that paying a bank interest and rent is "owning" a home.

It's going to take more of that thinking to correct this ridiculous demand for tract homes at $125+ per square foot. The younger generation is also way more environmentally conscious and is tired of seeing large chunks of land bulldozed and cleared to squeeze in as many houses as possible. 

I think there's a solution in building smaller and keeping rent low so that people aren't paying half their paycheck for a basic need. Tenants want cashflow just as much as a landlord does. It doesn't have to be tiny homes, just small 2 br 1 ba homes with all the appliances. We're currently looking into creating that option.