Wall Street investment firms are scooping up homes in depressed areas across the country, squeezing out individual homebuyers, giving some agents lots of business and possibly trending the areas into bubble territory, reports the New York Times.
The firms are spending billions of dollars in areas like Las Vegas and Phoenix, which experienced great runups and crashes in the housing crisis, to buy homes they plan to rent out until market conditions are favorable for a sale, the Times reported. Some analysts the Times spoke with suggest that the local markets could crash if local economies don’t keep up with the influx of Wall Street cash.
“When people write the story of this housing recovery, these investors will be seen to have helped put the floor under the housing market,” said David Bragg, an analyst at Green Street Advisors quoted in the story.
Source: New York Times