Avalanche of money flowing into the real estate market

Big money sources are pouring billions into real estate in the past 90 days. CNN reports that financial institutions are aggressively jumping to real estate investment. “Hedge funds and private equity firms have been rushing in to buy up companies and assets in every part of the housing supply chain, including undeveloped land, homebuilders, and foreclosed homes” Private equity firms are also getting in on the game. Blackstone Group spent $2.7 billion last year to buy 17,000 single family homes, post-foreclosure, around the United States and plans to continue ramping up those efforts in 2013.”

At the same time the Wall Street Journal says that markets are up in many markets. “More and more markets post gains in median home sale prices. The National Association of Realtors reported Monday that the U.S. median home price rose 10% between the fourth quarter of 2011 and the fourth quarter of 2012. That’s the biggest yearly gain in the median price since the fourth quarter of 2005.”

Mortgage News Daily reports that inventories are decreasing as lenders dump foreclosure property into the pipeline. “The unsold inventory of existing homes was at the lowest level since January 2001. ”

At TitleSearch.com the volume of foreclosure related title work is up 45%, with many investor clients scrambling to buy properties as many deals are showing up at auction. Foreclosure.com CEO Brad Geisen  is observing a similar trend. “A lot of investors see a short window of opportunity where there’s good inventory on the market at bottom market prices,” said Geisen. “No one knows how long it will last, so these investors are trying to buy as much as they can right now.”

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