Hedge funds have become a noticeably dominant player in the real estate market lately. While investor funds have always been a factor, it’s been easier to spot in recent months since inventory is so tight. As an example, consider Blackstone, a hedge fund that began aggressively buying properties in the Sacramento market over the past few months. Since August 2012 they’ve purchased 158 sales on MLS as THR California LLC. They may have other DBAs, but I’m only aware of this one. Investors friends tell me their plan is to rent out their portfolio, which makes sense since a great number of their purchases were bought at the top of the market and have already been remodeled.
As you can see below, Blackstone has purchased nearly 3% of all sales recently.
When looking at the entire market in Sacramento County under $200,000, it’s astounding to see how much cash is the market, isn’t it? I shared some cash stats from one week ago, yet cash sales increased by 3% from that time until now.
By the way, the Sacramento Business Journal came out with an article today entitled “Some worry that investment funds are distorting housing market“. I have a quote in the article. Unfortunately the article is for their print edition, so only part of it shows up online.
Questions: What are you seeing out there in the market? How do you think so much cash is going to affect the market long-term? I’d love to hear from real estate professionals, investors and prospective home owners.
If you have any questions or Sacramento home appraisal or property tax appeal needs, let’s connect by phone 916-595-3735, email, Twitter, subscribe to posts by email (or RSS) or “like” my page on Facebook