While many ask, "Have we reached the bottom in the current national decline in residential real estate pricing", the answer may very well be supported by the developing momentum in distressed asset funds that continue to draw significant investment interest. Much of the investment in these funds is driven by European dollars - from a European investor's perspective, the US is offering a "once in a lifetime sale" with the combination of a historically low dollar, and a rare national decline in real estate values.
In the North Atlanta area, there are several funds that have been raised by some of the larger real estate developers, both from an opportunisitic play on the current market conditions, and also as a hedge against their long position in land development. The regional funds I am aware of range from $50MM to $150MM in scale and primarily target bulk portfolio purchases from banks of foreclosed homes or large luxury home developments that were a little ahead of their time, and have now been repossessed.
On a national scale, there are many large funds being raised for similar purposes - Blackstone announced a new $11 Billion dollar fund this week per the attached link. http://www.bloombserg.com/apps/news?pid=email_en&refer=&sid=aKkKno._qU14
This trend of distressed funds should be interesting to follow, and should continue to gather steam. If from no other source, the supply and demand balance may ultimately be brought back into equilibrium by these opportunitic and well capitalized investment funds that underwrite a "long term hold" scenario for any distressed asset purchase they execute.
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