General Discussion
Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsWall Street Landlords Buy Bad Loans for Cheaper Homes
By Heather Perlberg and John Gittelsohn Feb 21, 2014 11:08 AM ET
Wall Street-backed landlords are showing a greater appetite for bad mortgages as a source for cheap property as the supply of foreclosed homes declines while housing prices continue to climb.
The companies have dominated U.S. foreclosure auctions in the last two years by buying as many as 200,000 single-family homes. Now American Homes 4 Rent, the second-biggest single-family landlord, Barry Sternlichts Starwood Waypoint Residential Trust and Altisource Residential Corp. (RESI) are leading acquisitions of non-performing loans, or NPLs, to expand their holdings of rental properties.
The shift to loans comes after foreclosure starts dropped to the lowest level since 2006 and house prices jumped in Atlanta, Phoenix and other markets where investors have made the most purchases. The development is raising concern among housing advocates that private equity firms and hedge funds will be more likely to take possession of the properties rather than offer loan modifications. Residents may be displaced or transformed into renters of their former houses.
Doug Brien, co-chief executive officer of Starwood Waypoint, said his firm plans to give delinquent residents a chance to stay put as owners or renters.
Our intent is to approach some of these folks where it just doesnt look like theyre going to get caught up on their loans, Brien said. The firm can offer them the opportunities to stay in their homes and keep their kids in the same school.
more...
http://www.bloomberg.com/news/2014-02-21/wall-street-landlords-buy-bad-loans-for-cheaper-homes-mortgages.html
MindMover
(5,016 posts)upaloopa
(11,417 posts)Wall Street sees that we are becoming a nation of renters.
The trend is to pay wages just enough to cover basic necessities and that is all. No wealth in the hands of the 99%.
In Kiev they are fighting against 80 oligarchs how many will we be fighting against?
dixiegrrrrl
(60,010 posts)They are treating foreclosures like "housing starts"....as if they were the same.
Oh god, where to begin..
"house prices jumped in Atlanta, Phoenix and other markets where investors have made the most purchases"
Well, yeah...the wolves came in, bought up the foreclosures at ABOVE auction bid price, leaving hundreds of real bidders out in the cold, which jacked up prices in select markets, leving even MORE real people out in the cold, rinse, repeat.
Anyone reading the news for the last 3 years saw this happening. These companies have TBTF banks as their parents, with all that free moneythey stole from us.
6.1 million foreclosures, is the figure I read somewhere recently.
So, create of a mass of renters from former owners, sell the houses and any remaining bad loans to hedge funds, who are also rich with cash, and create a monopoly on the rental market in large housing areas.
What could possibly go wrong??????
As Chris Hedges put it: "the only word they understand is *MORE*"
Xyzse
(8,217 posts)Instead of getting the refinancing that they need, or any other way to get better terms in their mortgage, particularly those that are trying to pay, who got stuck in the ARM types whose rates increased exponentially through no fault of their own... I find it deplorable.
reformist2
(9,841 posts)The /sarcasm sign is for Sheldon Cooper, and people like him.