If Large Cap Investors are buying........shouldn't you??
The names of the buyers at trustee sales reveal how much of this market is being captured by large players. If we examine trustee deeds issued in Maricopa and Pinal Counties since January 2012, we find the following top ten spenders:
- THR - 511 deeds - $54M
- AH4R - 305 deeds - $33M
- EZ Homes - 339 deeds - - $30M
- Castle - 58 deeds - $22M
- THPI - 191 deeds - $22M
- American Residential - 180 deeds - $21M
- Nancy Blue - 188 deeds - $19M
- Colfin (Colony Capital) - 172 deeds - $18M
- Skyline Vista - 88 deeds - $15M
- 2012-B Property Holdings - 100 deeds - $12M
THR is in the top spot and they only started to buy in May 2012! They are part of the Blackstone company which holds over $50 billion in real estate assets round the world. They have already bought more properties at the trustee sale in September than they did in the previous 3 months. They are the largest private equity real estate firm and currently have a strong appetite for Phoenix homes. Colfin also started in May but have not bought anything since July, apparently moving to other cities where prices have not moved upwards so quickly. AH4R started in April, when they were very active, but they have not bought anything since August. EZ Homes is a wholesaler who has been operating in Phoenix for many years currently averaging 30 to 40 homes purchased per month. Nancy Blue runs a large fix and flip operation that has been very active since 2008. American Residential is a locally run investment company that buys home to rent and has been active here for several years. Recently we have seen American Residential buy a large number of homes in bulk from other investors such as AH4R. THR have also purchased in bulk from other investors in June and August.
Of course many of these buyers are active in other types of transactions too (REOs, short sales, etc). The above is just based on what they acquire from the foreclosure auctions. Cromford Report Daily Observations
We know the market cannot truly be in full recovery mode until the distress segment is absorbed. Even so, clearly this drag on the market spells opportunity for cash investors (and of course, has for some time). However, for most of us, the most enjoyable transactions are with that 'normal' owner-occupant buyer who wants the best home (and best value all things considered). And yes, they'd like to think that their purchase might appreciate over time. Perhaps the above info helps in the sense that you now know and can give chapter and verse on who's who when it comes to big money players buying local residential real estate for cash flow and upside potential.
In other words, the message is, if big money is buying, shouldn't you?
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