When your cabbie starts giving you stock tips, it's time to short the market

“Laptop Landlords”

WSJ: Everyone’s a Landlord — Small-time Investors Snap Up Out-of-State Properties

Jack Cronin found San Francisco-area homes too expensive or too far from the city center to buy when he lived there in 2020. The tech worker still wanted a piece of the hottest housing market of his lifetime, so he started looking farther afield.

Last year, the 28-year-old used a website called Roofstock, which provides listings and data for investors interested in rental properties, to buy a three-bedroom home outside Jackson, Miss., for $265,000. Mr. Cronin, who now lives in New York City, has never visited Jackson nor met the tenants in his home, lightly landscaped with bushes and crepe myrtle trees. It’s enough to know that a management company collects $2,300 a month in rent for him.

“So far, so good,” he said. [Snicker]

Mr. Cronin is part of a new movement of laptop landlords, in which individual investors are buying homes, often in other states, to rent out. Many are well-paid professionals who view owning a rental as a core investment, alongside stock or bond funds. Recent technologies that simplify the process and enable home purchases online have fueled the movement’s growth.

Home purchases by investors large and small climbed to record levels during the pandemic, reaching a high of 28% of all single-family home sales in February of 2022, up from 17% during the same month in 2019, according to housing data firm CoreLogic. Individuals like Mr. Cronin or other small enterprises that own 10 or fewer homes accounted for about half of all investor purchases.

By the time the Little People move in to take advantage of a can’t-fail market, it’s already dying. Will the big boys like BlackRock suffer the same fate? I hope so, but maybe this time will be different, and they’ll prove too big to fail. You know, like these guys:

UPDATE: I just noticed that Mr. Cronin, the 28-year-old “investor” cited in the Journal’s article as buying a $265,000 house “sight unseen” in Jackson, Mississippi. I hope he located the property on a flood zone map and confirmed that it is outside the Pearl River’s reach, which has been actively acting up these days and still rising.