Silver Bay Realty Trust files to raise about $265M in an IPO. A spinoff of Two Harbors...

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Brian Bobbitt Comments (1347)
 
I am convinced that single family rentals will make the price of the underlying stock raise up. I have no clue about the dividend they will offer, but I would keep my eye on this market and yield and perhaps grab some. I hate IPO's only bought one every, FB and boy what a ride. JUST what I expected, thank goodness I only bought 20 shares to say I did. I have a sneakin' suspicion this may be interesting. Again, watch for the symbol SBY
Capt. Brian
The Lost Navigator
5 Dec 2012, 06:14 PM Reply Like

buzzavery Comments (15)
 
I have done residential investments for 2 decades. Rental ownership has grown significantly faster than residential ownership, especially when adjusted for the manipulated inflation of home ownership preceding 2008. As decline of the middle class inevitably continues, rental residency will eventually supplant owner residency, nationally. Austin, Texas is already 70% rental residency.

The question is will single-family rental residency be a better investment than multi-family rental residency. Zoning and development laws favor single-family. Historically, younger tenants occupy multi-family as a choice while older tenants prefer selectivity. Given these, and assuming wisely bought and managed SFRs, this will be a solid pick going forward.

Its a gamble at this point with this small startup company on the north beach of Lake Superior, but that could turn a big profit if they are run smartly.
6 Dec 2012, 01:11 AM Reply Like

kmi Comments (3844)
 
SFR have way higher operating/management costs than MFR. That, coupled with the fact that this is a new project, without a lot of history (6 months?) means I find this very risky.

I understand why the investment was made - but over the longer term I'd be pretty worried about its viability. This is a good play if there is an exit strategy in the form of sale after price appreciation or in the inevitable expectation of interest rates rising, but you have to float through until that happens.
6 Dec 2012, 08:53 AM Reply Like

buzzavery Comments (15)
 
I agree, very risky. IPO goal of $287M will buy a lot of SFR in a depressed market with suppressed interest rates. The economy supports this venture under the right leadership. TWO have been a smart REIT so this seems like an honest and capable spinoff.
7 Dec 2012, 02:15 PM Reply Like

maeisenstein Comments (4)
 
I invest for income. The principal that I own will belong to my children. The ups and downs of the market is their problem. I live off of the dividends. In todays crazy market the only decent dividend play is REITS and some ETF's. When I can get a 6 or 7 percent safe and steady return from treasuries or CD's or money market funds I will get out of the market.
6 Dec 2012, 06:12 AM Reply Like

BraceYourself Comments (3)
 
I may be more of an interested bystanders as I know nothing of how this will fit with TWO's mainstay business model?
LCW
6 Dec 2012, 06:12 AM Reply Like

vkerscheer Comment (1)
 
As a retired landlord, I'm looking forword to this IPO. Single family housing is set for a come back and this is going to be a great opportunity.
Capt. Vee
Another Navigator
6 Dec 2012, 06:18 AM Reply Like

Brian Bobbitt Comments (1347)
 
Ship Ahoy Matey! I too am a landlord, and I really don't feel like selling my income property at this juncture, although, I may take a decent offer. Prices here in Palm Beach County are still mighty depressed and homeowners associations are in deep doo doo as owners are not paying their dues. One of the associations I am in has a 50% delinquency from owners dues, but we are one of a very few HOA's still in the green, and not by much. Our involvement with smaller HOA's seems very shakey, no matter what the NGM's figures show.
I can tell you this, I strongly believe in the SFR rental scene, and I bet it is perfect timing. I hope I can get some of this SBY.

Capt. Brian
The Lost Navigator

Maybe I should sell my properties, and buy some of this stuff, and diversify into several different SFR's
6 Dec 2012, 10:51 AM Reply Like

dendv Comments (236)
 
In my opinion the SFR rental with older clients will be more stable, they do not destroy or damage as much and more apt to pay their rent on time. Also not as many HOA communities and less HOA restrictions. I will be watching for SBY also.
6 Dec 2012, 01:51 PM Reply Like