HomeLatest ThreadsGreatest ThreadsForums & GroupsMy SubscriptionsMy Posts
DU Home » Latest Threads » Forums & Groups » Topics » Economy & Education » Economy (Group) » The Wall Street gold rush...
Introducing Discussionist: A new forum by the creators of DU

Thu Mar 22, 2012, 10:21 PM

The Wall Street gold rush in foreclosed homes

Just keeps getting better, only in the USA.

NEW YORK (Reuters) - Dan Magder recently gave up a top job with private equity firm Lone Star Funds to strike out on his own and become a landlord.

He's joining a growing list of big and small investors who see fat profits to be made in renting out foreclosed homes, especially now the U.S. government is moving ahead with a trial project to sell big pools of single-family homes that Fannie Mae currently owns in some of the hardest-hit housing markets.

Investors seeking higher yields are drawn to foreclosures because the rental market is red hot. But the heated competition for foreclosed homes is reminiscent of the frothy expectations that seem to accompany each new Wall Street investing craze.

http://www.reuters.com/article/2012/03/21/us-usa-foreclosures-investors-idUSBRE82J12M20120321


Just amazing, take this quote from the story;
"This is actually moving the underlying physical assets, or homes, to the top 1 percent," says L. Randall Wray, a professor of economics at the University of Missouri-Kansas City and a senior scholar with Bard College's Levy Economics Institute.

5 replies, 1236 views

Reply to this thread

Back to top Alert abuse

Always highlight: 10 newest replies | Replies posted after I mark a forum
Replies to this discussion thread
Arrow 5 replies Author Time Post
Reply The Wall Street gold rush in foreclosed homes (Original post)
Royal Sloan 09 Mar 2012 OP
eridani Mar 2012 #1
Hugin Mar 2012 #2
girl gone mad Mar 2012 #3
dixiegrrrrl Mar 2012 #4
mother earth Mar 2012 #5

Response to Royal Sloan 09 (Original post)

Fri Mar 23, 2012, 01:42 AM

1. Parasitic scum should be jailed, not rewarded n/t

Reply to this post

Back to top Alert abuse Link here Permalink


Response to Royal Sloan 09 (Original post)

Fri Mar 23, 2012, 05:22 AM

2. Who are they going to rent these houses to?

Each other? The phrase "red hot" in there makes me leery... I wouldn't touch this with a ten foot pole. It's a wannabe bubble in the making.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to Hugin (Reply #2)

Fri Mar 23, 2012, 06:04 AM

3. You have to read between the lines.

Carrington claims that without using leverage or borrowed money it can generate an annual yield of 7 percent from rental income alone. Its long-term strategy is to package the fund into a publicly traded real estate investment trust.


This isn't merely a scheme to collect rents. It's also a scheme to bilk investors using other people's (+taxpayer) money. These private equity moguls won't be left holding the bag.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to girl gone mad (Reply #3)

Fri Mar 23, 2012, 09:07 AM

4. They want to securitize the rentals...good god

"package the fund into a publicly traded real estate investment trust."

Wonder if they will sell the same "packages" to more than one trust, like the banks did with the MBS?
Wonder if anyone is still stupid enough to buy any of these newly packaged REITs.

These new "investors" don't seem too worried about lack of legally documented titles.

Reply to this post

Back to top Alert abuse Link here Permalink


Response to Royal Sloan 09 (Original post)

Sat Mar 24, 2012, 09:05 PM

5. To enable this new money-grab for the 1% our Congress has bipartisanly agreed to help by

establishing what they are calling a "Jobs Act" which will further deregulate and enable these new so called "investments" for Wall St. to peddle...what a timely development. Congress is shameless, they sell this BS as some kind of win for the jobless...a sham that goes unnoticed...until TSHTF a little further down the road. They know what's coming, but they've got theirs don't they.

These bastards need to be ousted.

Reply to this post

Back to top Alert abuse Link here Permalink

Reply to this thread