by Wolf Richter
As after the last crisis, fueled by ultra-cheap money, they’re taking financialization of the housing market to the next level: Now it’s buy-to-rent, build-to-rent, sale-leasebacks, and buy-to-sell.
In many parts of the country, house buying has turned into a drunken land rush. Sales of new houses in August jumped 45% from a year ago, after having jumped 50% in July, to the highest sales rate since 2006, which was the end of the prior housing bubble. Sales of existing homes jumped to the highest rate since early 2007, particularly concentrated on single family houses.
This land rush has been ascribed to different factors, including people leaving rental apartments in big cities to move to the suburbs or exurbs; people suddenly deciding to start families; people – especially those that benefited from the crisis and made a killing with the Fed’s schemes – buying a second home outside the city; and people buying a home in a hurry without selling their old home first, hoping for a higher price later.