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Updated over 2 years ago on . Most recent reply
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1 in 5 Homes are being bought buy Wall Street traded firms
Wall Street's leverage in housing market is 'very concerning': Finley | Fox News Video
Will the current trend of hedge funds and publicly traded investment firms buying 1 in 5 homes continue? Will that percentage increase, decrease or stay about the same over the next year? 2 years?
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Quote from @Robin Carriger:
Wall Street's leverage in housing market is 'very concerning': Finley | Fox News Video
Will the current trend of hedge funds and publicly traded investment firms buying 1 in 5 homes continue? Will that percentage increase, decrease or stay about the same over the next year? 2 years?
Yes. It will continue for 6 months to a year. They have to protect their cash from inflation. They can't just put $40 billion or more into the bank or into bonds since the return is so low there. But, there is a second side to the question . . .
The other question is "Will hedge funds and publicly traded investment firms regret buying homes" I think so. There is so much pain to running a landlord business that they aren't generally prepared for the long term. Plus, they are accustomed to liquidity in stocks, bonds, mbs, cdo's, derivatives and other like-kind assets. Real estate is not liquid. There are a lot of down sides to owning real estate that don't fit their way of doing business. When the hedge funds start dumping real estate, it wil be a blood bath once again.
It is Just another cycle in the real estate investment business.