Home Prices See Biggest Annual Gain in 7 years

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http://www.nytimes.com/reuters/2013/06/25/business/25reuters-usa-economy-homes-index.html?smid=tw-share&_r=0

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housing recovery has been great but may start to slow down as interest rates have increased 1% in 30 days. That's huge when in comes to construction loans as buyers may no longer be qualified. Also, buyers can afford less putting pressure on prices.

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Investors Fuel Housing Recovery

Institutional investors have been instrumental in stoking the flames of the U.S. housing recovery and many large firms are still in the market for deals even as housing prices improve. Some large investors are spending billions in the hopes of converting single-family homes into rental properties to increase portfolio of assets as well as take advantage of the growing demand for rental properties. Many of these investors are also buying large blocks of homes to then resell to other investors that are also looking to get into the new single-family home rentals market.

Both individual and institutional investors continue to find ample opportunities to acquire properties at discount prices. Since starting to buy single-family homes at the beginning of 2012, Los Angeles-based Colony American Homes has amassed a portfolio of nearly 10,000 homes. “The ability to buy homes at attractive values in all of the markets that we are in continues to be very compelling,” says Justin Chang, CEO of Colony American Homes. For example, Colony expects to buy 1,000 or more properties in South Florida alone over the next year.

Colony isn’t the only institutional investor active in the single-family home niche. Blackstone Group LP recently secured a $2.1 billion syndicated loan from Deutsche Bank AG to facilitate its REO-to-rental investment program. These buyers are facing more competition and rising prices as the housing market begins to improve in many metros. Yet there continues to be a solid inventory of available properties including properties in foreclosure or distress, as well as homes listed on the open market at prices that are well below peak 2006 prices.

“There really seems to be a continued flow of distressed properties and shadow inventory,” says Stephen Karbelk, CAI, AARE, co-chairman and founder of AmeriBid LLC in Reston, Va. AmeriBid conducted an auction of single-family homes on behalf of the New Orleans Redevelopment Authority (NORA) last October where approximately 125 homes were sold. Nearly half of the properties that sold, 47 percent, sold to investors.

http://beforeitsnews.com/financial-markets/2013/04/investors-fuel-housing-recovery-2529714.html

how much shadow inventory are the banks still holding off the market?