Tuesday, June 4, 2013
Wall Street Investors Are Large Purchasers Of Distressed Housing
Wall Street investors have been purchasing large numbers of homes in states most affected by the housing bubble. They plan to rent the purchased homes and sell them later when prices increase. One of the benchmarks used to determine the fair market value of a home is a comparison of selling prices with the rental income from the property. It would appear that prices had fallen well below their worth as rental properties. The entry of investors into these markets has helped to drive prices up in states like Florida, California and Arizona. It may not be easy for the investors to exit these markets. Prices are likely to fall if they put large numbers of their rental homes on the market.