Stocks are tumbling. Is the great investor real estate sell-off next?
Wall Street investment funds and mom and pop operators like have spent years vacuuming up distressed homes across the country.
Now with prices rising by double digit rates, investors are looking to cash in. In practical terms, that means they are going to start dumping these one-time foreclosure specials on the market in 2014 and beyond, a panel of 110 economists and real estate forecasters surveyed by Zillow finds.
That could be good news for buyers as the spring market approaches, potentially cutting down on competition from cash-rich investors while putting more listings on the market.
The impact is likely to be a bit more muted in Greater Boston, where the big investment funds never really arrived, though we have certainly had our fair share of activity by smaller operators.
Nearly 80 percent of the panelists surveyed said they saw investors stepping down their buying activity in 2014, with 57 percent predicting that "investors will have sold the majority of homes in their portfolios" over the remainder of the decade, Zillow reports.
Here's Stan Humphries, Zillow's chief economist, in a quote I've lifted from the press release sent out this morning.
"Real estate investors, both large and small, played a crucial role in helping to stabilize markets during the darkest days of the housing recession, but a decline in investor activity now isn't necessarily a bad thing, and could have real benefits for buyers," Humphries said.
"Buyers entering the market in the next few months will not be competing with cash-rich investors like they were last year which should be some small solace given the higher prices and mortgage rates that they will encounter."
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