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Institutional buyers are buying distressed properties,…gigantic hoards

April 5, 2013

……If you think rapidly rising home prices is a good trend, you might want to think again.

………….Institutional buyers are beating owner-occupied traditional home buyers to the market. With gigantic hoards of cash at their disposal they are buying distressed properties, mostly those in foreclosure or through lender facilitated short sales, one at a time and in bulk where they can.

  • …. Blackstone Group (BX) has already spent more than $3.5 billion to amass a portfolio of more than 16,000 single-family homes. Chairman, CEO and Co-Founder of Blackstone recently said the firm was spending about $100 million a week buying homes.
  • Silver Bay Realty Trust Corp (SBY) is a newly spun-off  real estate investment trust, shed from its REIT parent Two Harbors Investment Corp. (TWO), that owns 3400 homes and is adding to its inventory of purchased-to-rent properties.

…but conceivably…. the first-in money will try and create a floor and push prices higher to sell out as high as possible……

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