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Private Equity Works on Its Image Problem

posted by Stephen Lubben

Bloomberg out with an interesting story about how private equity firms are buying single family homes at foreclosure to rent out. It surprises me that there is real interest in what remains a relatively small scale, highly heterogeneous asset. Previous attempts to achieve economies of scale in this area have been disastrous -- see Bank of America.


the Fed is pushing that; copying from my blogpost on it:
out of the dozen initiatives they suggested, the one that seems to have received the most attention has been the proposal to convert the significant inventory of REO (real estate owned) by the GSEs (Fannie & Freddie) and FHA into rental units...since we're talking something on the order of a quarter million homes that are in effect owned by government agencies, it would mean unloading a lot of properties relatively quickly...this would be done by bulk sales of such houses so that investors could obtain "geographically proximate properties to achieve efficiencies of scale" ...a similar proposal was made that would allow banks to rent properties rather than sell them that could in effect turn them into landlords...

embedded links here:

Isn't the Mass registrar of deeds saying that the deeds are all clouded?

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