I found this interesting about Blackstone Group...

What Blackstone's new real estate business really means for the market…

Private-equity giant Blackstone Group recently announced it would start making private loans to landlords who are looking to grow their residential housing portfolio, but are struggling to raise capital from traditional sources like banks. According to Blackstone, the minimum loan is $10 million. And the rates will float between 5% and 7% for up to five years.

Some people view this as a bullish development for the real estate market. But I don't think the implications for the real estate market will be very large…

Fannie Mae and Freddie Mac already enable a huge amount of residential mortgage lending. The U.S. is by far the best market in the world for long-term fixed-rate real estate lending. And I'm sure that Fannie and Freddie will get back into the landlord-lending business at some point.

In the short term, Blackstone's actions will increase the amount of capital available for apartment development a little bit, which is good for our country. But I think the bigger issue is not what this does to the capital markets. I think the bigger issue is what it could mean to Blackstone shareholders…

I don't believe large-scale landlords are able to efficiently own single-family homes. It requires so much overhead to maintain an individual property that I doubt it can be done in scale.

So I see Blackstone's decision to move into apartment lending as a sign that it may be ready to unload its large amount of residential property. I always felt that experiment would end in failure unless Blackstone was willing to quickly flip the properties. I think this is an indication that Blackstone will be unloading its residential real estate much faster than people expected… The firm already announced it would accelerate its real estate sales over the next 18 months.

I believe Blackstone discovered that the overhead cost of trying to maintain a portfolio of single-family homes is too great… And I'd be surprised if they don't liquidate that portfolio quickly over the next five years. And that's wiser and much more efficient than trying to own individual homes and then getting into the business of lending to small-scale apartment owners.

So far this year, Blackstone has spent $5.6 billion on real estate (mostly single-family homes), up from $4.7 billion at this point last year… It's now the largest landlord in the U.S.

To me, Jack, this looks like the beginning of the end of Private Equity buying homes, if they cannot make the returns they wanted, they will look to dump them as other equities rise in value and play those trades. Watch interest rates, as they rise, you will start seeing more properties on the market. Banks need higher rates to make more money.....