Published on Mar 4, 2014
PROVIDED BY CNNNEXT.COM
*Housing and consumer activists warn that Wall Street is about to crash the housing market -- again.
The activists said they are particularly concerned about the growing number of companies looking to issue bonds backed by rental properties -- bonds that a coalition of groups described as "eerily like" those mortgage-backed securities that helped fuel the last housing bubble...The 2008 housing crisis happened because banks were willing to give even risky borrowers a mortgage, driving home prices to unsustainable peaks.
Those mortgages got sold into bonds that defaulted once homebuyers stopped making their monthly payments.
This time, gun-shy bankers are hard-pressed to give anyone but the most stellar borrowers a mortgage, said the groups, which include California Reinvestment Coalition and the National Consumer Law Center.
Yet, home prices are rising again.
That's because Wall Street investors with deep pockets and the ability to pay cash for homes are muscling out ordinary buyers in places hard-hit by the housing crisis, like Phoenix and Atlanta.
Once these wealthy investors have bought the homes, they flip them into rentals -- often covering up large issues like plumbing and mold with cosmetic fixes...* The Young Turks host Cenk Uygur breaks it down.
*Read more here from Ben Hallman / Jillian Berman at The Huffington Post: www.huffingtonpost.com/2014/03/04/wall-street-rentals_n_4892205.html
