Rental housing in France is both heavily regulated and supported through dedicated public funds. Here's a high-level overview of what that means (via this 2021 Brookings case study by Arthur Acolin):
Homeownership rates in France went from 35% in 1954 to 56% in 2001
As of 2018, 58% of French households own, 40% rent, and the remaining 2% supposedly get free housing from either their employer or a family member
Not surprisingly, younger households are most likely to rent (the figure is > 60% for people aged 18-29)
Household size seems to play a major factor in how likely people are to live in public housing
France has some 4.5 million public housing units and 17% of all households live in them (which represents about 43% of all renter households)
Within the unsubsidized rental market, 93.5% of households live in homes owned by individual investors (this is as of 2013) and only about 3.5% live in homes owned by institutional investors
This is pretty typical of Europe, where multi-family isn't an established real estate asset class like it is in North America; so for those of you who like to hate on individual condo investors, check out France
In the decade between 2010 and 2020, 28 metro regions in France adopted some form of rent control and, in a few markets, like Paris and Lille, there are also maximum rents that can be charged for specific housing types
If you're interested in rental housing, Brookings also has articles covering the US, Germany, Spain, Japan, and the UK. They can be found here.
Today it was announced that venture firm a16z has made a $350 million investment in Adam Neumann's new residential rental company called Flow (which is kind of ironic).
The company is set to launch in 2023 and nobody on the outside seems to be entirely clear on how it plans to revolutionize the multi-family rental market, but supposedly this funding round values Flow at more than $1 billion and supposedly Neumann will be rolling in the 4,000 or so apartments that he has been buying up.
In any event, here's how a16z described the opportunity (I think the key sentence is probably the one about creating a system where renters become like owners):
Only through a seismic shift in the way industry relationships are structured and the mechanisms through which value is delivered can we hope to address the underlying problems of the current system and build the solution. Doing this requires combining community-driven, experience-centric service with the latest technology in a way that has never been done before to create a system where renters receive the benefits of owners. This means rethinking the entire value chain, from the way buildings are purchased and owned to the way residents interact with their buildings to the way value is distributed among stakeholders. And given the fragmented nature of the ecosystem today, we can only hope to accomplish any of this by bringing every aspect of the living experience together.
What I will say is that I think it's great to see this amount of innovation-focused money flowing into the residential real estate space, which is, after all, the biggest asset class in the world and one that could certainly use some fresh ideas. Apparently it's also the biggest funding round that a16z has ever done.
But I also find a16z's characterization of the problems a bit odd. Renting an apartment is described as this soulless and profoundly lonely experience where you're so ashamed of where you live that you're even hesitant to invite friends over. They also conflate house with home, as if to say that you can't have the latter without the former.
On second thought, maybe these are exactly the right problems to be solving. It is our biases that we need to do something about.
So it was announced today that Adam Neumann -- the cofounder and former CEO of WeWork -- has been quietly buying apartment buildings across the United States. According to the Wall Street Journal, he is involved in entities that have acquired more than 4,000 apartment suites valued at least $1 billion.
The buildings, which seem to be fairly typical and have at least a few hundred doors, are located in cities like Miami, Ft. Lauderdale, Atlanta, Nashville, as well as in many other US cities. It's not clear what the exact plan is for this real estate but people who claim to know things are saying that it will involve "redefining the future of living", or something along these lines.
Presumably this means catering to young professionals with cool design, fun amenities, and beer taps. Whatever ends up happening, it is interesting to see some of the cities that he/they are targeting. They are the cities that we've all been talking about for many years. You know, the ones that are growing quickly and have greater housing supply elasticities.