Article in the New York Times about the purchases of large amounts of distressed homes by private equity folks looking to turn profits by making these homes rental units. Seen as an alternative to other current returns in the market place, these ambitious folks are buying blocks of homes at supposed deep discounts.
Turning the fragmented real estate market into a private equity liquidity block trade seems only natural given the too big to fail environment Bernanke has underwritten. These type of investment strategies come directly out of the Fed stimulus initiatives of pushing liquidity into privileged hands and while in effect restricting capital and rousting many Americans from their homes. The old saying goes that God must love poor people because he made so many so that He and his rich friends can have a good laugh. Real estate has definitely turned and much like the impetus which is driving over valuations in stocks, there is an investment frenzy currently underway spawned from tech stocks and now into the broader S&P 500. Gains in 2012 rival the bull rush in 1998 which of coarse was the beginning of the end.
