by Calculated Risk on 6/03/2013 10:06:00 PM
Monday, June 03, 2013
Tuesday: Trade Deficit
An interesting article on investor buying from Nathaniel Popper at the NY Times Dealbook: Behind the Rise in House Prices, Wall Street Buyers
Large investment firms have spent billions of dollars over the last year buying homes in some of the nation’s most depressed markets. The influx has been so great, and the resulting price gains so big, that ordinary buyers are feeling squeezed out. Some are already wondering if prices will slump anew if the big money stops flowing.Investor buying has played a key role, but I don't expect investors to start selling in bulk (although the buying will probably slow down). Most of these large investors are planning on holding the properties for some time, but you never know ...
...
Blackstone ... has bought some 26,000 homes in nine states. Colony Capital, a Los Angeles-based investment firm, is spending $250 million each month and already owns 10,000 properties. ... Most of the firms are renting out the homes, with the possibility of unloading them at a profit when prices rise far enough.
While these investors have not touched many healthy real estate markets, they are among the biggest buyers in struggling areas of the country where housing prices have been increasing the fastest. Those gains, in turn, have been at the leading edge of rising home prices nationwide.
Tuesday economic releases:
• At 8:30 AM ET, Trade Balance report for April from the Census Bureau. The consensus is for the U.S. trade deficit to increase to $41.2 billion in April from $38.8 billion in March.