Buy to Rent is Over

[David Krulac]

according to article in new Bloomberg business Week of June 10, 2013, page 52.

"We just don't see the returns there, there's a lot of bluntly -stupid money that jumped into the trade without any infrastructure, without any real capabilities and a kind of build it as you go mentality that we think is irresponsible." says Bruce Rose, CEO of Carrington Holding.

Carrington, which manages about 25,000 rentals, has ceased buying rental properties and and has started to sell rentals.

The National Association of Realtors has said that house prices have risen 11% over the year ending in April 2013, while rents have risen only 2.4% according to Trulia.

Other buyers of single family residential properties have reported losses. Colony Capital only has a 51% occupancy rate for its 9,931 houses. And American residential Properties and Silver Bay Realty also reported losses.

[Bill Gulley]

I'm not one to say I told you so, but I told you so, some time ago when concerns were voiced here about corporate buyers. A real estate portfolio of shopping centers, motels, office complexes or medical buildings is very different than single family dwellings.
Takes boots on the ground and when they figure out that the computer system in the New York office can't get the water heater repaired or keep the local manager from dipping into the maintenance fund, they will start dumping them. :)