Morgan Stanley issues a report on single family houses as a investment strategy for institutional and private equity

This is an interesting news story and video about institutional investors buying single family housing assets.  Note the differences between the company “salesman” and the analyst’s comments and opinions.  Following are some key points from the story:

Single family rentals important part of “second wave” of housing

• Due to foreclosure , more people forced to rent
• More American’s renting than owning as percentage (?)
• Homeownership continues to decline in U.S.
• Tight credit environment will continue for foreseeable future
• Does private equity have the infrastructure to manage single family rentals
• First time in history that institutional investors will be buying single family

The Morgan Stanley report is obviously pushing investors to buy REIT shares instead of single family homes individually.  It will be interesting to see the returns of these REIT’s and how they compare to our clients who are buying individual properties and getting very low interest rates for investor loans (as low as 4%!).

I contend that only investors with limitation on mortgage financing should buy REIT shares instead of a “real property.” But I am biased of course!

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Here is another related story:  More Renters, Fewer Owners Story Link