Look out for large SFR portfolio transactions in your market

[Garrigues Wier]

I posted this fairly recently, but my post was cut off. I think there is good value in the abstract, so I am sharing it again! 

Basically, large portfolio transactions add value to surrounding home values - especially in distressed markets! 

This paper examines the recent explosive growth of institutional investment in the single-family-residential markets and its impact on local home prices. Using a quasi-natural experiment in which investors purchased pre-packaged home portfolios, we find that average properties located within 0.25 miles of bulk-sold properties sell for $3,323.25 higher than homes located farther away. The spillover effect is greater for foreclosed homes ($8,494.52), homes with similar size as bulk-sold properties ($3,665.07), and homes in highly distressed neighborhoods ($25,047.81). Our results suggest that while institutional investors conceivably pursue opportunities in distressed real-estate markets, they also provide valuable liquidity which helps recover neighborhood home values. 

(The full paper can be found HERE - originally found this on Reddit)