1. quiet guy said...

"The Fed’s policy is not creating more jobs or contributing to growth. It’s fueling another speculative ponzi-bubble that will lead to another meltdown ... Eventually, QE will end, interest rates will rise, investors will flee the market, and the meddling will stop."

Another bubble? Perhaps another possibility is that once these institutional investors get used to regular returns they'll feel pretty comfortable about being landlords.

I recall reading comments on the 'singing pig' site that UK landlords don't care what happens to property prices if they have a regular income stream to cover their costs and although I disliked the concept, it seemed sound to me for those landlords who bought early and hence have reasonably low mortgage costs.

Here's a quote from another of Icarus' posts:
"what we’re seeing is industrial-scale investment by Wall Street speculators who are getting lavish financing perks from the banks to buy distressed properties that, if they had been sold on the MLS or via bank auctions, would have driven prices down even further pushing bank balance sheets deeper into the red. In other words, the Obama administration, the banks, the Fed and the behemoth private equity firms are all in bed together to prevent firsttime homebuyers from getting a good deal on a foreclosure and to reward the people who blew up the financial system with another backdoor bailout."

Overall, the situation may actually be worse than the article suggests. If there was a bust in which "investors will flee the market" then the man in the street might get a chance at buying a reasonably priced property to live in but if those proprties were sold to investors at knock down prices in the first place then why sell them at all if they're giving a regular income?