Reply With Quote
Join one of the Chicago Organized Crime families...
Discounts for Speculators, Foreclosures for Mom and Pop!
Private Equity firms are piling in to the housing market to take advantage of bargain basement prices on distressed inventory. The Obama administration is stealthily selling homes to big investors who are required to sign non-disclosure agreements to ensure that the public remains in the dark as to the magnitude of the giveaway. Aside from the steep discounts on the homes themselves, the government is also providing “synthetic financing to reduce the up-front capital required if they agree to form a joint venture with Fannie Mae and share proceeds from the rental or sale of properties.” (Businessweek)
In other words, US-taxpayers are providing extravagant financing for deep-pocket speculators who want to reduce their risk while maximizing their profits via additional leverage. Speculators are getting lavish incentives (gov financing, low rates, and severe discounts) in secret deals to buy distressed inventory which should be available to the public at market prices. If that’s not a ripoff, then what is?
Now take a look at this clip from an article in Nuwire Investor:
“Single-family homes are on the radar with private equity investors for good reason. There is a robust pipeline of distressed properties that is allowing owners to buy property at a steep discount—typically 30 percent to 50 percent of replacement cost.
...inventory includes an ample supply of quality middle-class homes in good neighborhoods. Investors are finding that they can buy three-bedroom, two-bath homes, many of which were built in 2005 or later. At the peak of the market, these homes were selling for about $250,000, and now investors are able to buy them at prices averaging between $100,000 and $130,000.” (“Private Equity Funds Prey On Distressed Housing”, NuWire Investor)
Read that again. Obama’s preferred customers are getting discounts of up-to 60 percent of the home’s peak value and generous gov-backed financing to boot! Where can Mom and Pop get a deal like that?
Nowhere.
So, why all the cloak and dagger? Why is the public being kept in the dark? And, most importantly, why are taxpayers providing financing for moneybags PE firms on discounted homes that would sell on Day 1 if they offered to the general public? This whole operation stinks to high-heaven.
-- more -->
Join one of the Chicago Organized Crime families...
The 1% always wins, the 99% is ed.
My guess is that the PE people came up with this plan and got the govt to implement it.
PE lenders (many with fresh $100Bs from dubya's tax cuts) were huge contributors to predatory, bubble mortgages. They cleaned up on inflating the bubble AND now after the bubble popped.
So, these investors are paying just a little less than market value today. Right?discounts of up-to 60 percent of the home’s peak value
I'd say they're paying substantially less, otherwise they wouldn't be buying. They could make more on the $Bs elsewhere, but of course here, they are taxpayer guaranteed.
http://www.jparsons.net/housingbubble/
Depends which market you're in. If we're talking Phoenix or Las Vegas, 60% off of peak at least passes the smell test of reasonability. If we're talking anywhere in Texas, yeah, totally bogus.
There are currently 1 users browsing this thread. (0 members and 1 guests)
Posting Permissions
