One of the country?s biggest investors in residential real estate is sounding some early alarm bells that the period of great deals on houses may not last much longer. ?Blackstone Group LP has been purchasing foreclosed homes in bulk across the country for years, including over 10,000 homes last year alone. ?While the group plans on turning their purchases into rental homes, they see upward pricing trends creating urgency for single property purchasers as well.
Blackstone is the world?s larges private equity firm, and it spent over $1.5 billion on foreclosures last year. ?Jonathan Gray, Blackstone?s head of real estate, is bullish on the market and thinks the price increases may accelerate more quickly than most consumers believe. ?In an interview with Bloomberg News, Gray said ??The recovery in house prices could surprise people. ?They have just gotten beaten down so much and we?re not building enough to keep up with the population growth. Affordability is there. I think as home owners get a little bit of confidence, we will steadily have more people lean toward buying homes, faster home-price appreciation, which will be good for this investment strategy and good for the economy at large.?
Gray says that in their estimate, there are just two years left of ?great deals? on residential real estate. ??Prices are starting to move faster. ? That?s one of the risks that emerge as more people like us get into the space and as individual homeowner confidence grows. Frankly, buying a home today is pretty compelling.?
Inventory available for the average home buyer may become further constricted as other large investors scoop up moderately-priced homes and turn them into rentals. ?Thomas Barrack?s Colony Capital has purchased 5,500 homes since April, and Waypoint Homes is planning on having a portfolio of 10,000 homes by the end of 2013.
The big money is on real estate today. ?Potential home buyers should take notice.
??Seattle Homes, LLC: ? Sam DeBord, Managing Broker, Realtor
Coldwell Banker Seattle: Coldwell Banker Danforth & Associates
Twitter |?Facebook |?LinkedIn | Google + | Sam (at) SeattleHome.com
Data Source: NWMLS ? The Northwest Multiple Listing Service did not compile or publish this information.
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