Our Real Estate Background

Our Investment Thesis

Our Thinking

Experience and Execution

Our Geographic Focus

our thinking

REO to rental supports pricing and therefore could benefit communities:

We feel, and believe that banks agree, that well capitalized foreclosure or short-sale-to-rental initiatives can mitigate the local price dislocation and negative community impact. In fact in recent months some deeply distressed markets have shown material price recovery due to high levels of institutional investor purchases of housing, notably Phoenix and Las Vegas.
Reduction in vacant and deteriorating properties through rental also supports community house prices.

Financial institution strategies to address delinquencies and complete foreclosures are still unclear:

Financial institutions still have to deal with the approximately 4.1 million mortgages that are either already foreclosed or over 90 days delinquent, and possibly millions more from the 2 million mortgages between 30 and 60 days delinquent and others that may become delinquent from the pool of 13.7 million homes with negative equity averaging $73,055.

State laws, legal issues and regulatory constraints are slowing the resolution of mortgage defaults:
Average days to foreclosure are now up to 1072 in New York State and average 2 years nationally.
Modification of delinquent mortgages has not proven successful, with over 50% of such modified mortgages re-defaulting within one year. The resolution of current and future delinquent mortgages may take several years.

Perhaps 5 million households may move from ownership to rental:

Job losses and declining real incomes have compounded the difficulties associated with home ownership, making what had became record national levels of ownership unsustainable.
Industry analysts estimate that perhaps 5 million households will move from ownership to rental as a result of the housing market collapse.

It is our view that the growing need for more single-family rental housing can be addressed through the organized injection of large funds by institutional investors seeking yield.