Investors Cooling on REO-to-Rent By Diana Olick
Realty Check CNBC Pub. Friday June 7, 2013, at: http://www.cnbc.com/id/100799067
Also interesting, May 30, 2013 Joint Report on Federally Owned or Overseen Real Estate Owned Properties By U.S. Department of Housing and Urban Development Office of Inspector General and the Federal Housing Finance Agency Office of Inspector General, at: http://origin.www.fhfaoig.gov/Content/Files/May%202013%20Housing%20IGs%20Report.revised.v2.pdf
The report says (at
present) there are over 1.9 million mortgage borrowers over 90 days delinquent
on their mortgage payments to Fannie and Freddie. I imagine there are also a
very high number of defaulted mortgage notes held by banks and non GSE
investors. I believe this substantial supply [Shadow Inventory] will depress,
and keep a lid-on, home prices for quite awhile.
Over the past couple of years the REO-to-Rent institutional managers and their private equity money sources have created their own mini-bubble* which, it seems, has now priced the REO-to-Rent strategy out of the market. Now they will have to stop buying, try to digest their inventory, and try to figure out a way to earn the returns they promised their investors.
Watch out for the institutional REO-to-Rent IPO (hot potato) exit strategy.
* The Institutional Home Buying Bubble at: http://billsplace.posthaven.com/the-institutional-home-buying-bubble
Do you wonder who’s picking-up the tab? Read on . . .
An Overview of the Federal Housing Administration Testimony Before the United States Senate Committee on Appropriations, Subcommittee on Transportation, Housing and Urban Development and Related Agencies. Testimony of The Honorable By David A. Montoya Inspector General Office of Inspector General U.S. Department of Housing and Urban Development - June 4, 2013, at: http://www.hudoig.gov/pdf/testimony/FHA%20Testimony%206-4-13%20Final.pdf
Housing Prices: Up Or Down? Recovery … Or Artificial Housing Bubble Which Is About to Pop? By Washington's Blog Global Research, June 05, 2013, at:http://www.globalresearch.ca/housing-prices-up-or-down-housing-recovery-or-artificial-bubble-which-is-about-to-pop/5337747
REFILE - Blackstone Eyes First ever REO to Rent Securitization By Adam Temkin - Reuters - March 13, 2013, at: http://www.reuters.com/article/2013/03/13/abs-real-estate-idUSL1N0C5CO220130313
Landlord Blackstone Rushes To Capitalize On Housing Bubble By Launching First Ever REO-To-Rent Securitization Submitted by Tyler Durden on zerohedge.com - 03/14/2013, at: http://www.zerohedge.com/news/2013-03-14/landlord-blackstone-rushes-capitalize-housing-bubble-launching-first-ever-reo-rent-s
Also known as, The "Hot Potato". Flip that portfolio to the greater fool (but, as manager, maintain your property management fees).
IPO Preview: Colony American Homes - seekingalpha.com - Jun 4, 2013, see chart at: http://seekingalpha.com/article/1481071-ipo-preview-colony-american-homes?source=google_news
June 5, 2013 Reuters "Colony American
Homes (a division of Colony Capital) has postponed its IPO of 20 million shares
due to 'market conditions'
An Early Investor Says Buy-to-Rent Housing Is Over By John Gittelsohn – pub. Bloomberg - June 06, 2013, at: http://www.businessweek.com/articles/2013-06-06/an-early-investor-says-buy-to-rent-housing-is-over
REO To Rental Fed Plan Would Do Little For Housing, Says Goldman Sachs By Loren Berlin - pub. Huffington Post - January 6, 2012, at: http://www.huffingtonpost.com/2012/01/06/reo-to-rental_n_1189392.html