Rent-Backed Securities Are Here - Blackstone - America's largest landlord - actively selling its housing exposureSubmitted by Apple on Tue, 07/30/2013 - 20:17
Earlier today, when we reported that median asking rents in the US had just hit an all time high, we had a thought: how long until the hedge funds that also double down as landlords decide to bypass the simple collection the rental cash flows, and instead collateralize the actual underlying "securities"? One look at the chart below - which compares the median asking "for sale" price in black and the median rent in red - shows why.
There is more, but the gist is clear enough that we hardly need to point it out.
Or maybe we do: securitization marked the peak of the last housing bubble. If the Blackstone deal indeed comes to market and prices, and is followed by many more, the end of the second credit and housing bubble is now, mercifully, in plain sight, which for those sick and tired of centrally-planned and manipulated markets is actually good news: the faster this artificial house of cards crashes and burns, the better, so if Blackstone wants to dump its housing exposure to the biggest idiot, more power to it.