"The housing market" is, by far, individual home sellers. Home sellers without sufficient incentive to sell can afford to wait for a higher prices. They are getting massive utility from the house already, they live in it, they might have no reason to sell if they cannot get a sufficiently high price.
Barring loss of income, death, or something else that really motivates a home owner to sell, there is little reason for homeowners to sell the property at a price they deem too low.
Hence increasing supply is the only way to lower prices, because an empty house usually has has negative utility (property tax, maintenance, security, etc), so the seller (home builders) are far more motivated to sell it.
Data like Zillow's Zestimate may impact the prices that people start with, but supply and demand take care of the rest.
I think that the lack of housing supply in most markets and higher demand for housing is what is keeping prices inflated.
If anything, this shows how high prices _would have gone_ had the interest rates stayed low, given that they are still high with today's high mortgage rates lowering demand.
this is empty verbage -- the money supply is run by groups of people i.e. the tender is tendered by tenders. Those comfortable with double-dipping into the cash supplies and using it to boost asset prices, did so with gusto. The rest of society suffers with a small (governing,lending) few benefiting mightily. The "copium" statements by the intellectually uncurious, those who are benefitting, and those that are perpetrating, come off like this vacuous non-statement above.
Keeping adding people and not housing supply and prices will go up. Remove people and add housing supply and prices will go down
The auto world works a little different since there is an entire wholesale operation behind the scenes that also drives pricing. There are several alternatives to KBB although less targeted to consumers. Also way more standardized in condition reporting.... but I know too much about the industry.
I do think that the introduction of software has probably made price discovery more efficient and gives landlords more confidence that if they raise rents, they will easily have offers even if the current tenants leave.
For some of the more desirable and built-up urban neighborhoods, small individually owned properties are all but bought up and almost all of the units are in large complexes owned by large corporate landlords.
I live in NYC. The housing market sucks here - but I don't think its because of collusion in setting prices. The supply just isn't as high as demand (and millions of voters who already own property seem fine with that)
But if we consider that people would consider living in the larger commute area, the article says:
> Across a wider Washington-Arlington-Alexandria area, more than 90 percent of units in large buildings are subject to RealPage pricing
And these large building are the bulk of the housing stock in these areas, they're not competing with single family homes or duplexes in these areas.
I'm not suggesting an app couldn't help coordinate prices in this instance, but I am suggesting that as long as the buildings are owned by other people they still have strong incentive to compete with each other.
If I own a building and the app suggests I raise prices, but then the units don't fill, I'm just going to lower prices.
> If I own a building and the app suggests I raise prices, but then the units don't fill, I'm just going to lower prices.
Yes, but if everyone raises prices together, people won't just choose to be homeless. Collusion is anti-competitive because it ensures that the participants wont compete with each other on price. They all raise rates together so people are stuck: their rent went up, but so did rent everywhere.
In a competitive market, some will raise rates, some will keep them the same, some may drop them. Those differences in strategy is what creates competition. When everyone cooperates to do the same thing, it eliminates competitive pressure.
It would be interesting to see if how rent markets change if more data becomes available. In the auto-industry, a car dealer can offload the unit to the wholesale market to minimize loss, whereas a landlord is less liquid.
The inventory pressure is there in both situations. An unsold car after 30-60 days is a problem both because of typical retail business dynamics and additional factors with general vehicle depreciation and high maintenance overhead of a vehicle compared to other capital goods, but the exit strategy is there and risk exposure can be limited.
Adding transparency, and a tax incentive to fill vacant rentals, could make rent prices less sticky.
I would be surprised if this were the case. It's supply and demand. Imagine there are 20 houses available for sale in a small area. The Zestimate for each is 1.5M. But I see they are sitting on the market a long time, and I don't see a full open house. If I am going to bid on one, am I bidding 1.5? Nope. I am gonna bid way less because I perceive the market is in my favor (more supply than demand)
Opposite scenario. Only one house for sale. The Zestimate is the same 1.5M. The open house is mobbed. Am I going to bid 1.5? No, because I gotta bit higher if I want this house because the market is not in my favor (more demand than supply.)
The Zestimate is useful in the 2nd case because it tells me what a similar house in the area went for, so I have an idea of how much people are willing to pay, and go higher than them. But I am not going to actually bid high unless I see the market shape that way.
Or a house where the seller is dropping prices for many months will have the old data deleted, and the history only shows that it was just put up for sale at a lower price than before.
I don't know if this is a feature of MLS, but Zillow already had the data, so I cannot think of a reason that they would remove the data unless they wanted to hide the fact that the houses are not moving at the original prices.
BTW this is one of those cases where having an agent helps you. A good agent will be able to tell you "oh there's a lot of houses coming on the market, getting no bids, and coming off" if you don't pick up that insight yourself.
And it’s selectively deleted too. For example, one house, you can see the price reductions in 2010/2011, and then it never sold. And they tried selling again, and reduced price, and once again, the house didn’t sell, but this time, all of the information about this year and last year was deleted.