>If they outbid everyone who actually wanted to live there, who were they planning to sell to?
other investors. housing is only "underpriced" because it's become a commodity market that investors play in. the people who want to live in the houses have no hope of affording them when they have to compete with all the various capital funds that are buying houses and hoping to flip them to other capital funds using a slightly different algorithm to calculate value.
Your thinking is that there is a hierarchy of capital funds, each one willing to pay more than the last for the same house? And they all hold the houses, pay property tax, etc. despite the houses never generating any revenue due to no one living in them? That doesn't seem like a very realistic perspective on the housing market
Why would other investors buy an overpriced home? They are also looking for the deals that Zillow is hoping to find. Owners wanting to live in a home are the ones willing to buy a turnkey home above asking.
other investors. housing is only "underpriced" because it's become a commodity market that investors play in. the people who want to live in the houses have no hope of affording them when they have to compete with all the various capital funds that are buying houses and hoping to flip them to other capital funds using a slightly different algorithm to calculate value.