I own one rental property, so I hardly consider myself a pro. That said, I've helped family members so I consider myself somewhat knowledgable. I was replying to another thread in the Houston forum from someone who was thinking about getting into real estate when I did some research and stumbled across this article.
http://dealbook.nytimes.com/2014/01/...-bonanza/?_r=0
I posted the below list/scenario in the Houston forum, but felt this might be a better place to get more experienced perspectives. I'm in my mid 30s, so I wasn't really paying too much attention when the stock market burst from the dot com era. The S&L crisis is a vague memory of sitting with my dad and watching the news. The only significant market crash I've experienced is the 2008 mortgage meltdown. I have to say, the article seems to paint a scenario that could very easily repeat that same fiasco:
1) Banks owning increasing large swaths of residential real estate
2) The only people who can buy profitable investment properties will be the "pros" who have connections or clout with the banks
3) Their mortgages will be chopped up and sold off to funds, so no one will be accountable for underperforming investor loans
4) As their portfolios grow, those investors will care less and less about individual properties, so those loans could start to underperform.
I don't know, maybe I'm just being paranoid, but something doesn't rub me the right way about this.
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