Tuesday, November 26, 2013

A great addition....

....to the recent post here, "More in the ongoing corporate takeover of America", in which it was pointed out how many single-family homes are being snatched up by groups of investors.

This is described by writer Laura Gottesdiener, in a new piece on TomDispatch,  as "a whole new get-rich-quick scheme", and she's not wrong. As she says, "Over the last year and a half, Wall Street hedge funds and private equity firms have quietly amassed an unprecedented rental empire, snapping up Queen Anne Victorians in Atlanta, brick-faced bungalows in Chicago, Spanish revivals in Phoenix. In total, these deep-pocketed investors have bought more than 200,000 cheap, mostly foreclosed houses in cities hardest hit by the economic meltdown."

But you won't believe how much of the market one giant conglomerate in particular has bought up!  Gottesdiener writes that "since the buying frenzy began, no company has picked up more houses than the Blackstone Group, the largest private equity firm in the world. Using a subsidiary company, Invitation Homes, Blackstone has grabbed houses at foreclosure auctions, through local brokers, and in bulk purchases directly from banks the same way a regular person might stock up on toilet paper from Costco.

In one move, it bought 1,400 houses in Atlanta in a single day. As of November, Blackstone had spent $7.5 billion to buy 40,000 mostly foreclosed houses across the country. That’s a spending rate of $100 million a week since October 2012. It recently announced plans to take the business international, beginning in foreclosure-ravaged Spain."

This is a dangerous trend. Read the rest of the article at TomDispatch.

2 Comments:

Blogger Father Tyme said...

You really have to wonder who they plan on selling these houses to.

Or do they plan on buying enough property in an area to clear it and "put up a parking lot?!" (at atrocious rates!)

8:30 AM  
Blogger Anna Van Z said...

I don't think they plan on selling most of these - I think they want to control all the rentals. At which point they can charge whatever they want, and there will be little else available.

Like I said earlier, a "glorious" return to feudal society. That's the plan.

11:14 AM  

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