Only 200 of the 1.2 million homes that went into foreclosure this year were worth more than $5 million, but super luxury foreclosures are on the rise. When they can no longer pay their mortgages, though, it's the wealthy owners not their lender who take the biggest hit.
Blackstone began marketing the first-ever US home-rental asset-backed security on Wednesday, with some 300 potential investors expected in New York to peruse the nearly $480 million deal.
Though most observers forecast rising home prices would drive investors out of the market for single family rentals, that fact is that to date investors have purchased more homes than they did in all of 2012 or 2011.
Recovering prices helped short-term flippers earn an average gross profit of $54,927 on single family home flips in the third quarter, up 12 percent from a year ago.
Thought foreclosures were dead? Not quite. Hallowe'en must be coming because foreclosure filings rose 2 percent in September and new foreclosures are rising from the grave in 11 states.
The shadow inventory-the number of homes in the foreclosure pipeline--is down 33 percent from a year ago and now is at its lowest level since August 2008, at least one year before the notion of a foreclosure shadow inventory was recognized.
Institutional investors accounted for 10 percent of all sales in August, up from 9 percent in July and 9 percent in August 2012, reported RealtyTrac in its monthly foreclosure report released Thursday, September 26.
That's how Ingo Winzer, president and founder of Local Market Monitor, sees the future of rental markets for investors, but "investing in rental properties will be an attractive proposition for many years because of the increasing numbers of people who can't afford to be homeowners."
Vacation property rentals outpaced hotels this summer as owners enjoyed strong bookings that were as good as or better than last year.
While declining numbers of foreclosures are slowing down most investors, the leading homes-for-cash company is expanding into new territories.
Two years ago, to the delight of investors and the anguish of homeowners, foreclosures regularly sold for 30 percent or more below the price of "normal" homes. How times have change! Now the foreclosure discount is less than half that amount and still headed south.
Asking home prices are losing steam as mortgage rates rise, inventories expand, and investor demand declines. Nationally, asking prices dropped 0.3 percent in July - the first month-over-month (M-o-M) decline since November 2012. Seasonally adjusted, prices rose 3.3 percent quarter-over-quarter (Q-o-Q), down from a peak of 4.2 percent in April. Year-over-year (Y-o-Y), prices are up 11 percent nationally, according to Trulia's July market report.
Real estate ranks second as America's favorite long term investment despite the three trillion dollars in equity homeowners lost during the housing depression, according to a new survey by Bankrate.com.
Last week two Federal Reserve researchers answered that question with an analysis of returns on investment since 1926 and their findings won't make the housing industry happy.
In some markets--many of them in California--the home price rebound has pushed prices above their EHP level, which should be a caution sign for investors seeking to make money in a quick re-sale, according to the latest HomeVestor/Local Market Monitor Best Market Ratings for investors.
Real estate investors are responding to higher prices by buying fewer properties in the next 12 months and holding their rental properties at least five years or longer, according to a national survey of real estate investors conducted by ORC International for MemphisInvest.com and Premier Property Management Group.
Boasting of spending up to $8 billion dollars to buy tens of thousands of foreclosures to convert into single family rentals, nearly 50 Wall Street investment firms set real estate markets on fire over the past 18 months. Now they are running for cover as soaring prices water down their return on investment.
After accounting one out of four home sales in the depths of the housing recession and fueled turn-arounds in dozens of markets where waves of foreclosures and battered home values scared off other buyers, real estate investors today are playing a greatly diminished role in the housing recovery.
In another sign of institutional investors' appetites for foreclosures, inventories of presale foreclosures have declined nearly twenty percent since last year as lenders have made volumes of foreclosures available via REO tapes to well-funded hedge funds eager to buy in bulk.
Have real estate investments peaked? After years of growth during the Foreclosure Eva, investment purchases declined slightly last year after surging 64.5 percent in 2011. With the cost and competition to buy distress sales growing and prices for normal homes rising, will investors pull back and start cashing in their assets?
The inventory of properties in the foreclosure process expanded by nearly 10 percent in the first quarter, casting a pall over the housing recovery as local markets prepare for more foreclosures than expected. However, a high level of demand driving by investor activity may mitigate their impact.
Perhaps the greatest advantage of a short sale to beleaguered homeowner facing default and foreclosure is the opportunity to move on with life and put the bad debt behind them as quickly as possible. That advantage is shrinking as short sales take longer to sell than foreclosures.
While the rest of the nation's housing markets experience various levels of recovery, most markets in Florida seem to be relapsing to the heyday of the Foreclosure Era after a brief period of improvement.
Though hedge fund purchases on a national level have had minimal impact, in the nation's hottest foreclosure markets hedge funds, or institutional investors, are contributing to double digit foreclosure price increases and dramatic declines in REO inventories.
Thirty-eight real estate markets have been tagged as "dangerous" for investors looking to make money on buying homes as rental properties in new quarterly data compiled by HomeVestors of America (known as the "We Buy Ugly Houses®" company) and Local Market Monitor.
Last month the New Republic published a provocative article on hedge funds and real estate investing (<a href="http://www.newrepublic.com/article/112395/wall-street-hedge-funds-buy-rental-properties">Your New Landlord Works on Wall Street</a>) by former TV producer David Dayen. He said out loud what many people have been whispering.
The 23 states that require court orders to foreclose and other states that have enacted legislation that delays foreclosure processing will take twice as long as the rest of the nation to clear backlogged foreclosure inventories at their current rate.
The low prices that make foreclosures attractive to investors also make foreclosures toxic to communities and homeowners. The discount between "normal" priced homes and the prices paid for properties than have been through the foreclosure process can spell the difference between profit and loss to an investor at the same time that they drive real estate values into the ground.
Single family home tenants are 18 percent more likely than apartment tenants to stay in their current homes five years or longer, suggesting that demand for single family homes, the fastest growing rental category, will be more stable than multifamily demand, according to a new national opinion survey released today by Premier Property Management Group.
Hot foreclosure markets have come and gone over the past seven years but one thing seems to stay the same. The markets with the most and the cheapest foreclosures are still located in Florida.
Demand for foreclosures is so great and supplies are so low in some of the nation's hottest foreclosure markets popular with investors that the price differences between REOs and full-price homes have virtually disappeared.
For the first time ever, sales of properties in some stage of foreclosure (largely short sales) outnumbered sales of bank-owned properties (REO) in the third quarter, as short sales continue to gain market share at the expense of REO and sales of completed foreclosures at auction.
Iinventories of foreclosures accumulated during the processing slowdown in the wake of the Robogate scandal are slowing shrinking, absorbed by demand so healthy that distress sales are actually rising faster on a national basis than full-priced homes.
The national average discount on foreclosures has shrunk by 1.4 percentage points over the past year as competition for foreclosures as inventories tighten is driving prices closer to full-price properties.
Despite rising prices and shrinking foreclosure inventories, 65 percent of active real estate investors plan to buy as many or more residential properties in the next 12 months as they did in the past year, according to a new joint BiggerPockets.com/Memphis Invest national survey conducted by ORC International for BiggerPockets.com, the nation's largest and most active real estate investing social network, and Memphis Invest, one of the nation's leading providers of single-family rental real estate investment services.
The average foreclosure-related sales price in the second quarter ($170,040) soared 6 percent from the first quarter of the year and was up 7 percent from the second quarter of 2011 - the first annual increase in average price since Q2 2010 and the biggest annual increase since Q4 2006.
As interest grows in creating a marketplace to sell securitized blocks of single family rentals, similar to the securitization of mortgages, perhaps as early as this year, the authoritative ratings service Fitch Ratings today made it clear that the asset class poses some unique risks and that high investment grade ratings will be difficult to attain due to the lack of historical data and "ambitious growth strategies by regional operators".
On the same day the Census Bureau released the Q2 2012 Housing Vacancies and Homeownership report showing single family rental vacancies in the second quarter were lower than they have been since the first quarter of 2006, yet another well financed asset management company announced it will spend more than a billion buying, renting and selling distressed homes.
The explosion of single family rentals-houses bought by real estate investors and rented to a single tenant-is creating a new category of property management companies to serve them.
With growing demand and record shortages of entry-level properties sweeping the nation, the company famous for buying "ugly houses" is sitting pretty.
Widespread shortages in housing inventories, especially in states that have experienced large price declines since 2006, are reducing the time homes for sale are spending on market, especially move-in ready foreclosures (REO) .
Significant price increases in bank-owned foreclosures are driving gains at the national, regional and local levels, helping home prices turn the corner with small quarterly and yearly gains.
Fitch Ratings" outlook for U.S. residential real estate prices has improved slightly in recent months, but the authoritative ratings service still sees no bottom to declining housing prices until late 2013.
While inventories of homes for sale have been shrinking this spring, MLSs are filling the void with rental listings for single family homes that until recently were foreclosures. Some 16.1 percent of all listings on MLSs today are rentals, more than double the number in 2006.
Only two out of ten of the nation's 8.7 million single family rental properties are managed by professionals; individual owner/ investors take care of most of the rest. Last year only about a third of single family rentals, 35 percent, made a profit on their rental income. Some 2.3 million lost money for their owners.
During the boom, the only way first-time buyers, minorities and working families could afford to buy a home was through subprime and creative financing. Now that homeownership is affordable, new barriers to financing and competition with investors are locking them out of homeownership and changing the residential fabric of our communities from ownership to rental.
Low home prices and strong demand for rental properties are causing a surge in investor buying, driving up the market share of homes purchased by investors.
With rents rising faster than last year, the picture for residential real estate investors is getting even better than it already was as a result of once-in-a-generation prices and low interest rates, according to the founder of the leading Internet platform for investors and real estate professional.
Even though the real estate depression has delayed many from moving ahead with plans to sell the family home, baby boomers are a red hot market for investment properties.
According to the latest data from Realtor.com, the world's largest real estate site, Florida single family home and condo prices are zooming at the same time that the rest of the nation is still recovering from the first quarter's double dip.
Bank-owned foreclosures (REOs) are taking significantly longer to sell than foreclosures bought and resold by investors, extending the timeline for REO foreclosures even longer than the extraordinary delays for resulting from slower processing.
Lower prices and the strong Canadian dollar are encouraging one in five Canadians to buy U.S. property today, according to a new survey of by the Bank of Montreal.
All-cash home sales are setting records in market after market around the country as investors account for a growing share of home purchases and individual buyers, especially first-time buyers, fade as mortgage rates rise and home buyer demand softens further.
The quality, as well as the quantity, of many bank-owned properties in the REO inventory is creating a drag on home values because they are difficult to sell in today's market, Scott Sambucci, vice president of Altos Research, said yesterday in a Webinar for investors.
Interest rates below 5 percent and prices bottoming out in the first half of the year will drive two of the three main ingredients for buyer affordability to cyclic lows next year, Freddie Mac's chief economist said yesterday.
Prices on homes ready to be occupied fell an average of 6.8 percent between May and June, but prices for damaged foreclosed properties increased by 5.9 percent during the same period.
Gross revenue from residential real estate auctions have skyrocketed 49 percent over the past six years, an increase of $5.6 billion.
These days, it’s hard to find much to cheer about in the Case-Shiller top twenty or NAR’s quarterly metro market report. Yet far beneath the radar of the national or MSA level data, some folks are smiling.
Thought no-down payment mortgages were a thing of the past?