It’s been eight years since the global financial crisis sent American homeowners into a tailspin. Many were fighting tooth-and-nail to keep their homes, and millions lost that fight. For a significant number, it was an uphill battle as they coped with job losses and stagnant wages on top of the plummeting value of their homes and toxic mortgages.
And now, private equity firms and hedge funds have found a way to exploit the holes left in these communities. Wall Street is snapping up distressed properties from Freddie Mac, Fannie Mae and HUD at an alarming rate, according to a new report from housingwire.com.
In fact, researchers discovered that some of the very same corporations responsible for the housing market crash are now buying and selling those vacant houses and delinquent mortgages created by the fallout.
Collectively, Wall Street has raised more than $20 billion to purchase notes on more than 200,000 U.S. homes.
These companies are seeing a new market for single-family rental units. Those same people who lost their homes to foreclosure have been forced to rent because they don’t have the credit to buy. Even when they do, they are edged out of the market by large firms that plunk down cash offers before families even have a chance.