Not exactly....
Those 3% down government backed home loans are a problem. They add no additional value - only drive up the cost of housing.
So the reason that they work is because they are traded and traded and traded through mortgage backed securities and derivatives.
Residential real estate is in for a reckoning. I just wanted to give you my two-cents. Michael Burry likes property with fresh water rights. That's a two-pronged bet - one on the land and one on the water - and I like it better.
BlackRock is not taking out mortgages. The real-estate is nothing more than a 15, 20, 30 year “bond” to them. As long as they are earning better than the US treasuries rates, they are good. They couldn't care less about prices, they can easily manipulate the market prices by creating a lumber, copper, whatever Shortage.
Not exactly.... Those 3% down government backed home loans are a problem. They add no additional value - only drive up the cost of housing.
So the reason that they work is because they are traded and traded and traded through mortgage backed securities and derivatives.
Residential real estate is in for a reckoning. I just wanted to give you my two-cents. Michael Burry likes property with fresh water rights. That's a two-pronged bet - one on the land and one on the water - and I like it better.
BlackRock is not taking out mortgages. The real-estate is nothing more than a 15, 20, 30 year “bond” to them. As long as they are earning better than the US treasuries rates, they are good. They couldn't care less about prices, they can easily manipulate the market prices by creating a lumber, copper, whatever Shortage.