By Heather Perlberg | Bloomberg Business
BlackRock Inc. is the latest company planning to finance investors who buy single-family homes, capitalizing on soaring rental demand as the U.S. homeownership rate sits at a five-decade low.
BlackRock, the world’s largest money manager, will buy loans from a network of partners that offer financing to the firm’s specifications starting as soon as next month, said two people with knowledge of the plans, who asked not to be identified because the information is private. Its lending partners also will offer funds to renovate homes that will become rental properties, one of the people said.
Tara McDonnell, a spokeswoman for BlackRock, declined to comment on the investment.
BlackRock joins Cerberus Capital Management, Blackstone Group LP and Colony Capital Inc., which have been competing to finance smaller landlords of the 14 million rental houses across the country and bundle the loans into bonds to juice returns. The new type of debt may make even more money available to single-family home landlords as many Americans struggle to get mortgages and opt to rent instead.
