Whenever a hedge fund is involved in something, I start looking around for the government bailout that is soon to follow. While I've been critical of a lot of the hand-wringing over the investments in single-family rental housing (oh, the awful tenants, how will they maintain the properties etc.), a couple of things are making me just a little nervous. The first is that Colony Capital is setting up for an IPO, which could mean they are seeking to diversify their investor base. A couple of other groups are planning the same thing. Not necessarily a bad thing as an investment strategy, but it could be an indication that the initial investors want out...
Of course, this doesn't benefit tenants at all.
But apparently there are some funds that have run out of foreclosures and other distressed properties and gone into buying new houses. New houses have a "new" premium--everything is unused, pristine and all that stuff. But the house loses its "newness" the minute someone moves in, so the resale will be for a not-so-new house. That makes me nervous--these people have so much money that they can now make bad decisions.
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