What new home builders used to create in the outlying suburbs for the first-time homebuyers, are now becoming the prime property for the new renter nation and real estate investors the New York Times reports.
What used to be new starter homes, now are great rental properties for real estate investors as the pool of available home buyers has shrunk due to the recession, tighter credit rules, lower wagers, and unemployment. In addition there is a reluctance to buy among younger, traditional first-time home buyers many who have large student debts now to manage.
While the percent of homes built specifically for rentals is small at 6.2% in 2012 according to Census figures, that still represents an all-time high.
Some companies including Colony Capital, a hedge fund in California, are also building new homes to rent, according to the New York Times. About 1,000 of Colony’s 15,000 rentals are new homes, with a concentration in the Atlanta suburbs. Also some of these companies are involved in selling to foreign investors.
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