BlackRock Said to Start Financing Rental-Home Investors

[proverbialwisdom]

Source: Bloomberg.com

by Heather Perlberg
August 24, 2015

BlackRock Inc. is the latest company planning to finance investors who buy single-family homes, capitalizing on soaring rental demand as the U.S. homeownership rate sits at a five-decade low.

BlackRock, the world’s largest money manager, will buy loans from a network of partners that offer financing to the firm’s specifications starting as soon as next month, said two people with knowledge of the plans, who asked not to be identified because the information is private. Its lending partners also will offer funds to renovate homes that will become rental properties, one of the people said.

Tara McDonnell, a spokeswoman for BlackRock, declined to comment on the investment.

BlackRock joins Cerberus Capital Management, Blackstone Group LP and Colony Capital Inc., which have been competing to finance smaller landlords of the 14 million rental houses across the country and bundle the loans into bonds to juice returns. The new type of debt may make even more money available to single-family home landlords as many Americans struggle to get mortgages and opt to rent instead.

Read more: http://www.bloomberg.com/news/articles/2015-08-24/blackrock-said-to-start-financing-rental-home-investors

[proverbialwisdom]

1. Check out these numbers.

Anecdotal account, NYC: http://www.nytimes.com/2015/08/23/realestate/the-upper-west-side-for-a-lifestyle-change.html

[jtuck004]

2. Huh. Between this and the last administration, over 10 million families have watched the wealth

they had in their homes, trillions of dollars, be transferred to bank$ter/donors, while they are kicked out into poverty, and now their wages are so low that they spend nearer half what they make or more for what used to be less than 30% of a healthy budget, and their paychecks have been depressed so much they can't afford the rising rents to even get a roof over their head.

Fucked up country.

[Ed Suspicious]

3. Capitalism is so many shades of shit.

[Bonhomme Richard]

4. Now it's time for them to pick up the scraps. n/t

[DebJ]

7. That's exactly what must have happened in my area in 2013-2014.

Our area had been accruing a large number of foreclosures that sat about for a good long while, depressing housing prices terribly.
Our home dropped from $205,000 to $132,000 at the pit. There are no jobs in the greater county area, but there never really have been, and the decline in jobs has been steady in Pa and in our area for decades. I couldn't figure out why my neighborhood and adjoining neighborhoods were suffering a much higher drop in price than other areas in the county. Our tax rates are not that different, and our local school gets good marks (as much as any school can get good marks these days). Then I looked closer, and saw that most of these all brick homes, mostly with nice large yards, were 2 bedrooms. Massive amounts of 2 bedrooms in this area.

I checked Zillow recently for the first time in awhile, and saw that within a one year period, all these homes had been snapped up. The same real estate company seems to have handled most of the transactions. The prices were ridiculous: $15,000, even $500. I'm thinking some poor family lost their home for delinquent taxes or something. So very sad. I don't think many of these homes are even occupied. Putting out $15000 is nothing. Don't rent it (so you don't fix anything), take a loss on the income taxes, sit on it, then sell it some years later for a huge ROI. While some family is hungry and paying insane rents or else homeless. Fuck these bastards.

Our house has 'recovered' up to $149,000, so now we are only under water by $20k, ha.

[Bonhomme Richard]

8. I am so tired of the greed. n/t

[7962]

5. Never mind them, their rates suck.

I can do better with a local bank thats actually LOCAL

[Kelvin Mace]

6. So, they are going to crash the economy one more time?

Can't say I blame them, it paid off handsomely last time.

[harun]

9. Yeah, why cash in once when you can cash in twice?

[Psephos]

10. It will work even more to their favor in the next go-round...

...now that they have gotten bail-in (i.e., deposit seizure) written into US law.