Guess who owns 12,556 homes in Atlanta? An interesting point: it’s a spin-off from the world’s largest private equity company, BlackRock, also known as Invitation Homes.
Why is that important? According to a recent article, in certain Atlanta zip codes, Invitation Homes bought 90% of the homes for sale in the early 2010s. I find that at least interesting, and even more disconcerting.
They are not simply buying the homes to flip; they are buying homes which are low-middle-priced homes in middle-class neighborhoods for the purpose of creating a revenue stream for the long-term. Based on recent analysis, it takes them only eight or nine years to recover the cost of buying a home, but all the while creating a revenue stream. Not only is this a fairly low-risk investment but it does not factor in property appreciation, which over the last year alone was over 29%.
This investment strategy then shrinks the number of available homes in that zip code that are available for sale to middle-class buyers but they do so by financing them at sub-market level, making the cost less because they’re paying a lower mortgage rate than the single-family buyer would.
Most of the homes they are buying are found in relatively inexpensive single-family neighborhoods that are considered growing metro areas.
So where do these Wall Street firms look to stake their claim? Well, according to Redfin, they like Atlanta, Charlotte and Phoenix.
If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.
Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.
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