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May 2 - Private Equity Firms are buying all the Single Family Homes in America



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 1 month ago '05        #1
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phantomnation  topics gone triple plat - Number 1 spot x56
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May 2 - Private Equity Firms are buying all the Single Family Homes in America
 

 

A bidding war broke out this winter at a new subdivision north of Houston. But the prize this time was the entire subdivision, not just a single suburban house, illustrating the rise of big investors as a potent new force in the U.S. housing market.

D.R. Horton Inc. built 124 houses in Conroe, Texas, rented them out and then put the whole community, Amber Pines at Fosters Ridge, on the block. A Who’s Who of investors and home-rental firms flocked to the December sale. The winning $32 million bid came from an online property-investing platform, Fundrise LLC, which manages more than $1 billion on behalf of about 150,000 individuals.

The country’s most prolific home builder booked roughly twice what it typically makes selling houses to the middle class—an encouraging debut in the business of selling entire neighborhoods to investors.

“We certainly wouldn’t expect every single-family community we sell to sell at a 50% gross margin,” the builder’s finance chief, Bill Wheat, said at a recent investor conference.

From individuals with smartphones and a few thousand dollars to pensions and private-equity firms with billions, yield-chasing investors are snapping up single-family houses to rent out or flip. They are competing for houses with ordinary Americans, who are armed with the cheapest mortgage financing ever, and driving up home prices.

“You now have permanent capital competing with a young couple trying to buy a house,” said John Burns, whose eponymous real estate consulting firm estimates that in many of the nation’s top markets, roughly one in every five houses sold is bought by someone who never moves in. “That’s going to make U.S. housing permanently more expensive,” he said.

The consulting firm found Houston to be a favorite haunt of investors who have lately accounted for 24% of home purchases there. Investors’ slice of the housing market grows—as it does in other boomtowns, such as Miami, Phoenix and Las Vegas—among properties priced below $300,000 and in decent school districts.

“Limited housing supply, low rates, a global reach for yield, and what we’re calling the institutionalization of real-estate investors has set the stage for another speculative investor-driven home price bubble,” the firm concluded.

The bubble has room to grow before it bursts, according to John Burns Real Estate Consulting. But it is inflating fast. The firm expects home prices to climb 12% this year—on top of last year’s 11% rise—and increase at least 6% in 2022, a period of appreciation reminiscent of 2004 and 2005.

That boom was different, fueled by loose lending that enabled individuals to speculate on home prices by racking up mortgages they could repay only if home prices kept climbing. The money party ended a few years later when home prices stopped rising. The ensuing crash wiped out $11 trillion in U.S. household wealth and brought the global financial system to the brink of collapse.


Financiers stepped in starting in 2011 and gobbled up foreclosed homes at steep discounts. They dispatched buyers to courthouse auctions with duffel bags of cash. Smartphones and tablet computers—new then—enabled them to orchestrate the land grab and manage tens of thousands of far-flung properties thereafter.



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 1 month ago '10        #2
acegutta22  topics gone triple plat - Number 1 spot x1
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If y’all want to read more about this look up a book called home wreckers
+76   

 1 month ago '07        #3
240ka  topics gone triple plat - Number 1 spot x1
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sh*t is fu*ked up. Once again the "American dream" is being stolen from hard working Americans by the rich
+181   

 1 month ago '11        #4
PotheadFocker 
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 240ka said
sh*t is fu*ked up. Once again the "American dream" is being stolen from hard working Americans by the rich
Golly gee whillikers what do you mean pal? Capitalism is the end all be all of democracy and freedom. Billion dollar corporations and inflation are the bee's knees.

Saying anything otherwise is communism, friend.
+109   

 1 month ago '15        #5
PineappleOG 
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Gonna lead to another bubble, houses are becoming unaffordable
+101   

 1 month ago '20        #6
Xiox  topics gone triple plat - Number 1 spot x1
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It's very true
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 1 month ago '16        #7
foshoVoodoo  topics gone triple plat - Number 1 spot x34
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this is what the bank bailouts was all about. Where the people bailouts?
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 1 month ago '12        #8
iamsweets 
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Yup, but people here in AZ blame people from other states for the surge in home prices. Invitations Homes are buying any and everything under 300k


Last edited by iamsweets; 05-02-2021 at 12:58 PM..
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 1 month ago '17        #9
ninesix703 
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 240ka said
sh*t is fu*ked up. Once again the "American dream" is being stolen from hard working Americans by the rich
Why not point the finger at the government that made interest rates the lowest they've ever been? Housing prices were gonna rise til the end of next year.

Unlike you I expect private equity firms to make easy money speculative investments.
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 1 month ago '08        #10
cohs  topics gone triple plat - Number 1 spot x4
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Unlivable house in dc had 76 cash offers and sold for 200k over asking.
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 1 month ago '04        #11
Viper504 
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I been trying to buy a house in NC put offers 15-25k over asking and lost because cash offers , people now paying the difference if the house doesn't appraise for what it sold, and people offering 10k+ due diligence. Finally got a house yesterday offered 15k over and 10k due diligence , didn't think I'd get it especially cause the house has a inground pool.
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 1 month ago '13        #12
North!!!  topics gone triple plat - Number 1 spot x8
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 PineappleOG said
Gonna lead to another bubble, houses are becoming unaffordable
Tbh I don’t think so

Americans collectively have way more equity than ever

They would sell if sh*t hits the fan

Also it’s record low inventory making prices so high

Way more buyers than sellers making homes so valuable

Though I do think prices have to come down just not no depression/recession steep discount sh*t...
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 1 month ago '13        #13
North!!!  topics gone triple plat - Number 1 spot x8
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I’m a relatively young realtor

But this sh*t is the craziest market ever it seems

A big part of the reason homes are so high is cause sellers are not selling Mike that

Record low inventory basically everywhere

People not selling, lack of new builds plus crazy buyer demand...
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 1 month ago '07        #14
pandadays  topics gone triple plat - Number 1 spot x4
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 North!!! said
I’m a relatively young realtor

But this sh*t is the craziest market ever it seems

A big part of the reason homes are so high is cause sellers are not selling Mike that

Record low inventory basically everywhere

People not selling, lack of new builds plus crazy buyer demand...
Which state are you in? I'm in florida I can barely set an appointment for a walkthrough before a house is sold. Bought and paid for in all cash
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 1 month ago '13        #15
North!!!  topics gone triple plat - Number 1 spot x8
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Right now theres considerably more realtors than available homes for sale
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 1 month ago '13        #16
North!!!  topics gone triple plat - Number 1 spot x8
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 pandadays said
Which state are you in? I'm in florida I can barely set an appointment for a walkthrough before a house is sold. Bought and paid for in all cash
New York

Lol I hear it’s basically like this across the Country and lowkey the world
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 1 month ago '05        #17
pnoi89  topics gone triple plat - Number 1 spot x4
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 iamsweets said
Yup, but people here in AZ blame people from other states for the surge in home prices. Invitations Homes are buying any and everything under 300k
That's exactly what's happening here in Colorado...

People from other states with higher cost of living selling their homes and moving into Colorado.

It's not that they're rich, but they just come from a higher cost of living and from an area that experience lots of capital appreciation from their first home, that the cash they're bringing in is super inflating tf out of Colorado.

My home (just a normal 3,100 sq ft. house built in 2001) I bought for $265k in 2013, is now appreciated and worth nearly $500k. Ridiculous sh*t.
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 1 month ago '17        #18
Ifeellikekobe  topics gone triple plat - Number 1 spot x2
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Yep this is about to get real bad for potential home buyers.
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 1 month ago '18        #19
DUCEDUCE  topics gone triple plat - Number 1 spot x1
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Everything looking like a bubble right stocks houses
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 1 month ago '13        #20
North!!!  topics gone triple plat - Number 1 spot x8
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 Ifeellikekobe said
Yep this is about to get real bad for potential home buyers.
If they can buy they should buy now

It’s tough but it’s the cheapest money ever

Even with rising house prices if you getting a mortgage, the monthly payment should be manageable

What you be worse would for homes to be super cheap price wise but interest rates was crazy high

The monthly payments would be higher in the second instance

Waiting could price some out the market for good...
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 1 month ago '14        #21
strungout  topics gone triple plat - Number 1 spot x3
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 North!!! said
I’m a relatively young realtor

But this sh*t is the craziest market ever it seems

A big part of the reason homes are so high is cause sellers are not selling Mike that

Record low inventory basically everywhere

People not selling, lack of new builds plus crazy buyer demand...
Heard it's a mess out in Toronto
+7   

Top 10 most propped recently  1 month ago '15        #22
isthistobe  topics gone triple plat - Number 1 spot x19
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Everyone copping everything right now

Resellers controlling the market on all aspects from PlayStations to homes
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 1 month ago '11        #23
SteffDub 
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 Ifeellikekobe said
Yep this is about to get real bad for potential home buyers.
About?? Already is man. I’m in Michigan, my Wife and I been looking for damn near two years. It’s crazy how fast houses are selling. Up until about two years ago you could get a very very very nice crib for less than160k now it’s houses with pink tile and carpet in the bathroom going for 170 smh. If you don’t offer at least 20k over asking within two days of the listing you might as well move on to the next one cus it’s a wrap.
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 1 month ago '11        #24
SteffDub 
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 isthistobe said
Everyone copping everything right now

Resellers controlling the market on all aspects from PlayStations to homes
You need a got damn bot to buy a crib lol
+23   

 1 month ago '05        #25
Ari Gold  topics gone triple plat - Number 1 spot x1
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Place a cap on single family home valuations, problem solved. If the only direction is down, you'll remove the investors and leave homes for those in need. Only issue is that would be a 1st step into an actual equal housing possibility. Next would be making wages relative to being about to purchase a single family home.
+13   



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