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How much of the acceleration in home price gains is the result of one big player? Blackstone...

How much of the acceleration in home price gains is the result of one big player? Blackstone (BX) is buying homes at a furious pace, now having spent $2.5B for 16K properties, up from $1B in October. The firm is quickening its buys, alarmed by the rise in prices (which its own purchases appear to be causing).
Comments (9)
  • I hypothesized in an earlier article of mine that speculators were likely responsible for the "recovery" in the housing market. Given that the banks aren't lending to *consumers*, this isn't such a hard stretch. The S&P 500 and the Dow are coming down from the 3rd top of a broadening top or megaphone formation. This projects a sufficient move to break the 4 year old rising wedge trend in the indices, which should send the markets much lower. How long can the big players keep up their distribution program they must undoubtedly be running now before anyone else wises up?
    9 Jan 2013, 08:15 AM Reply Like
  • These buyers enjoy a very low cost of funds, netting about 1%, so they can afford to sit with the inventory, unlike individuals who need the cash flow. My guess is that big players will relieve the banks of all their single family homes and then buy out some of the small aggregators who realize the rental income doesn't justify the price being offered. Banks will be in much better shape. Little speculators will get burned, as usual.
    9 Jan 2013, 01:13 PM Reply Like
  • Seth can u post the chart formations you describe. would be nice to see in graph.
    bx may find they bit off to much. renting single family properties are inefficient and can be difficult. I do think they may learn a lesson.
    This is more speculating going on. These houses are for families and people to live in at reasonable prices not get back to the ponzi schemes we are so used to seeing in real estate land.
    16 Jan 2013, 11:00 AM Reply Like
  • Government Housing....just like in Russia in the 70´s...you can bet this is not arms length.....
    9 Jan 2013, 08:20 AM Reply Like
  • I would differ with the thought that speculators are responsible for the recovery. There are many people getting new loans for houses, refinancing existing (I am), and renting in a hot rental market.

     

    If BX and others want to invest in RE, let them. It's not easy to rent houses and there is a demand for rental housing as rental rates are increasing as vacancies drop (good for my business--I own apartments). They are helping to stabilize a market that was driven by speculators and second home retirees.

     

    Hurray for QE3 as that's what is responsible for the recovery in housing.
    9 Jan 2013, 10:26 AM Reply Like
  • did you ever think that when inflation does begin, they will make a fortune in home price increases?
    9 Jan 2013, 12:47 PM Reply Like
  • f
    9 Jan 2013, 12:47 PM Reply Like
  • no wonder my all cash bids havent been good enough i knew the big $$ was here in charlotte if you dont bid 10,000 over asking price you have no chance only way to get one of these foreclosures is a H.U.D. house which the first 10 days of bidding are for owner occupant if not a hud house you have no chance i been trying since Sept and no luck even with bids 5,000 over asking plus you cant waste time getting realtor to even show you the inside cause big money buying without ever seeing the inside
    9 Jan 2013, 01:39 PM Reply Like
  • Speaking of timing real estate deals....

     

    Didn't Blackstone buy the Hilton hotel company four years into a (stock) bull market--right near the top--just before the Great Recession decimated hotel revenues and the price of hotel stocks?
    16 Jan 2013, 10:32 AM Reply Like
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