Search
Exact matches only
Search in title
Search in content
Search in comments
Search in excerpt
Filter by Custom Post Type
{ "homeurl": "http://rismedia.com/", "resultstype": "vertical", "resultsposition": "hover", "itemscount": 4, "imagewidth": 70, "imageheight": 70, "resultitemheight": "auto", "showauthor": 0, "showdate": 0, "showdescription": 1, "charcount": 3, "noresultstext": "No results!", "didyoumeantext": "Did you mean:", "defaultImage": "http://rismedia.com/wp-content/plugins/ajax-search-pro/img/default.jpg", "highlight": 0, "highlightwholewords": 1, "openToBlank": 0, "scrollToResults": 0, "resultareaclickable": 1, "autocomplete": { "enabled": 1, "googleOnly": 1, "lang": "en", "mobile": 1 }, "triggerontype": 1, "triggeronclick": 1, "triggeronreturn": 1, "triggerOnFacetChange": 1, "trigger": { "delay": 300, "autocomplete_delay": 310 }, "overridewpdefault": 0, "override_method": "post", "redirectonclick": 0, "redirectClickTo": "results_page", "redirect_on_enter": 0, "redirectEnterTo": "results_page", "redirect_url": "?s={phrase}", "settingsimagepos": "left", "settingsVisible": 0, "hresulthidedesc": "0", "prescontainerheight": "400px", "pshowsubtitle": "0", "pshowdesc": "1", "closeOnDocClick": 1, "iifNoImage": "description", "iiRows": 2, "iiGutter": 5, "iitemsWidth": 200, "iitemsHeight": 200, "iishowOverlay": 1, "iiblurOverlay": 1, "iihideContent": 1, "loaderLocation": "auto", "analytics": 0, "analyticsString": "", "show_more": { "url": "?s={phrase}", "action": "ajax" }, "mobile": { "trigger_on_type": 1, "trigger_on_click": 1, "hide_keyboard": 0 }, "compact": { "enabled": 1, "width": "200px", "closeOnMagnifier": 1, "closeOnDocument": 0, "position": "fixed", "overlay": 0 }, "animations": { "pc": { "settings": { "anim" : "fadedrop", "dur" : 300 }, "results" : { "anim" : "fadedrop", "dur" : 300 }, "items" : "fadeInDown" }, "mob": { "settings": { "anim" : "fadedrop", "dur" : 300 }, "results" : { "anim" : "fadedrop", "dur" : 300 }, "items" : "voidanim" } }, "autop": { "state": "disabled", "phrase": "", "count": 10 } }
Select Page

Over the past year it has been reported that several private equity companies, hedge funds and private REITS have turned their attention to the single family home market. This is the first time capital sources like this have taken such a keen interest in our marketplace, and it presents great opportunity as well as great challenge.

On the opportunity side, the top 5 funds eyeing our space have already raised over $3 billion and have an appetite for much more. In fact, estimates from sources in that industry say that the total appetite will be in the neighborhood of 10 million homes over the next decade. How can that be? Look at the numbers:

  • There are 150 million households in the U.S.
  • 65 percent are homeowners. Roughly 50 million (35 percent) households are renters.
  • Half of them rent single family homes.
  • That’s 25 million rental homes in this current environment.
  • Institutional investors intend to acquire 10 million.

The good news is clear. The one thing a soft real estate market needs to completely recover and revive is more demand on a large scale. Billions in completely new demand will provide that upward pressure on prices and drive us into a full blown recovery. More good news is the creation of rental stock for all the families being displaced by foreclosure and short sale. These families need a place to land and investors will provide it.

There are risks. Our market performs wonderfully when there is a one-seller/one-buyer balance. It’s when institutions have gotten involved in the past when things have gone haywire. The current housing crisis is the best example. When institutions tampered with lending standards, they artificially boosted buying power for millions of buyers and it drive prices up to an unnatural level. The resulting correction was the market’s response. We have to be cautious, which means it is important that professionals with experience in the housing market play a role in shaping the strategies of these new institutional investors. This is definitely not a time for us to be passengers on our own train.

Until recently, the majority of institutions had very similar business plans – buy portfolios of houses in bulk from Fannie, Freddie and the banks. It makes sense. Get a discount on foreclosures and buy the way they are most comfortable – from another institution.

But that strategy is failing. Government interference in the foreclosure process has caused the large mortgage servicers to turn to short sales instead of REOs as the best solution to a non performing mortgage. The portfolios are not available to be bought in bulk, so now the big investors must enter the open marketplace to buy homes one at a time. Many large investors are also lowering their expectations to a more realistic level.

No longer are they bent on buying at a deep discount. Many are now more interested in sound fundamentals and good cash flow. Properties that fit that description are hiding right in plain sight all over the country. Maybe in your market. They are looking for our help in building quality portfolios all over the US.

But how do they do that when our industry does not speak their language? How can they evaluate properties as assets when there are no standards of how to measure and report CAP rates and cash-on-cash returns? How can they utilize the massive force of the real estate brokerage industry when the industry is not prepared to meet them half way?

The opportunity is now for brokerages to get their agents trained and equipped to service this new and massive wave of business. There is a solution to the housing recession at hand – billions of new dollars from buyers who were never in the market before. Amazingly, the only thing holding it back is a lack is our readiness.

Greg Rand is the CEO of OwnAmerica. For more information, email greg@ownamerica.com. Or visit www.ownamerica.com.


Buying/Selling Consumer Luxury National Spotlights
Concept business illustration.
Industry Expert Dave Garland Joins NAR’s Second Century Ventures Investment Team

Second Century Ventures, the strategic investment arm of the National Association...

Smiling young couple shaking hands with an insurance agent or investment adviser
Quicken Loans Ranks Highest in Study of Mortgage Servicing Client Satisfaction

Detroit-based Quicken Loans recently ranked highest in the country for client...

Betty_Crocker_450x300
Have Your Cake (and Eat It, Too) at the Betty Crocker House

Fresh out of the (cake) box is the Betty Crocker House,...

Agent Broker Coaching Lead Gen Teams
Real estate agent and senior couple by For Sale sign in front of house
4 Ways to Generate More Seller Leads This Summer

Real estate professionals are in the business of selling and, because...

cookies
Cookies Can’t Redeem a Bad First Impression

Think about your favorite products—your favorite cereal, chips or toothpaste. Whatever...

Key to success
3 Keys to Success in 2016

Two years ago, we completed a comprehensive planning session at Real...

Agent Best Practices Branding Broker Niche
Print
5 Ways to Grow Your Brand Awareness Using Promotional Merchandise

When competition is fierce and customers are continuously bombarded with products...

La Habra, United States - July 12, 2016: Macro closeup image of pokemon go game app icon among other icons on an iphone smartphone device. Pokemon Go is a popular virtual reality game for mobile devices.
Pokémon GO for Real Estate – Must or Bust?

If you’re anything like me, your social media newsfeeds look a...

Man inputing data on laptop and holding mobile phone in another hand.
Boost Your Online Presence with More .REALTOR Options

Website addresses that end in .REALTOR provide instant recognition as a...

Agent Apps/Gadgets Best Practices Broker Innovation
Silhouette of business people moving and joining pieces of jigsaw puzzle on a business and stock market  blue background, with charts, diagrams, world maps and data arranged on grid and tables. World maps showing continents and countries with economy data and growth diagrams. Light glowing from the center. Copy space on bottom.
PNC Offers Online Business Insights, Webinars and Tools for Agents

Looking for the latest real estate industry information, education and networking...

Woman holding tablet
Stay Connected to Your Business When You’re on the Go

As a busy real estate professional, you’re likely most productive when...

snapchat_real_estate_665x350
Why Snapchat Is Pure Gold for REALTORS®

There is a huge amount of attention being paid to Snapchat...

Business Insights Content Generation Marketing Trends
000027558128_Double
Webinar Recap: Build Your Brand with Next-Gen Social Media

If you’re working in the real estate industry, you already know...

000042086008_Double.jpg
Expanding Your Client Base through Social Media

Today’s buyer will search online at some point during the buying...

Facebook_Live_665x350
Facebook Live the Latest Trend to Infiltrate the Open House Scene

Drumming up interest in an open house may be about as...

Buying/Selling For Your Clients Home Improvement How-To Lifestyle
comback_kitchen
Comeback Kitchen: 3 Old-Is-New Trends

Kitchen design’s trending more behind the times than ahead of the...

468752934
5 Kitchen Island Styles to Fit Any Use

Regardless of the size of your kitchen remodel, adding an island to...

Wall_Panel_450x300
Luxury Wall Panels Take Home Décor to a Whole New Level

Looking to revamp your living space? Before you head out to...

manhattan
RISMedia’s CEO Exchange

RISMedia’s 2016 Real Estate CEO Exchange September 13 & 14, 2016...

Capital Building, Washington
RISMedia’s Power Broker Forum at the NAR REALTORS® Legislative Meetings & Trade Expo

RISMedia’s Power Broker Forum at the REALTORS® Legislative Meetings & Trade Expo...

PB-annual
RISMedia’s Power Broker Forum, Reception & Dinner – Annual

RISMedia Power Broker Events 2016 Orlando, Fla. Friday, November 4, 2016...