Article excerpt... "Almost nine years after the housing-market bust helped trigger the most recent recession, RealtyTrac senior vice president Daren Blomquist sees the industry waving a red flag.
The same fervent speculation that abetted the housing bubble is showing up in the bloated share of foreclosures snapped up by third-party investors at auction — a record 31 percent in June, according to RealtyTrac data that starts in 2000.
Many of those third-party buyers are "mom and pop" investors with less experience, said Blomquist. At the same time, institutional investors, a subset of the third-party investors who purchase at least 10 properties a year, are ducking out of the market.
And while investors at foreclosure auctions could rely on about a 40 percent discount from the previous sales price in the early years of the expansion, this year they're only garnering about a 30 percent markdown, Blomquist said.
"The pressure is building in the pressure cooker, and at some point that's going to need to be released," Blomquist said. There's a little time — "probably not in the next month or two but in the next couple of years," a downturn should set in, he said."
Link to entire Bloomberg article: The Housing Market Is Waving a Red Flag - Bloomberg:
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