The astonishing true story of how speculators are changing Homeowner's Insurance issues into Renter's Insurance issues!
Recent newspaper reports continue the publication they began months ago of bewilderment over housing sales. Sales of single-family homes have been falling for months and home sales continue to fall. Yet, housing sales prices are rising and continue to rise. See for example two of several recent newspaper articles like these: "Stocks & Bonds / Weak News on Home Sales Helps Send Shares Down," p. B2, col. 1 (Reuters report published in New York Times Nat'l ed., "Business Day" Section, Saturday, February 22, 2014); "Wintry Blast Chills Sales of Houses", p. B5, col. 6 (Reuters report published in New York Times Nat'l ed., "Business Day" Section, Tuesday, January 28, 2014).
Speculators are purchasing foreclosed homes. Most of the foreclosed homes purchased by the speculators used to be single-family homes before the Great Foreclosure Recession began. Speculators -- a good old word for what newspapers generically call "investors" -- are paying top dollar for foreclosed homes. Speculators drive up prices and drive would-be homeowners out of the market. The new owners are becoming landlords. They are making their money by renting the properties. Michael Corkery, "Wall St.'s New Housing Bonanza / Some Question Sales of Bonds Backed by Foreclosed Homes Turned Into Rentals" p. B1, col. 5 (New York Times Nat'l ed., "Business Day" Section, Thursday, January 30, 2014).
Homeowner's issues are turning into renter's issues. This development has been, well, developing for at least a few months now. See "Foreclose, Buy, Rent ... Whither Homeowner's Insurance?" published here on November 26, 2013. Homeowner's Insurance issues are even more certain to turn into Renter's Insurance issues the more time that passes.
© 2014 by Dennis J. Wall. All rights reserved. No claim to original U.S. Government works.
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