Vulture investors are feasting on the depressed United States housing market. Swarms of vulture investors sniffing for distressed properties are being attracted by collapsing prices, record-low personal property rates and rental demand fueled by foreclosed borrowers. But in this weak United States economy, their strategy is changing. Vulture investors flipped homes for a quick payout in good times. Now that times are bad, using properties to generate healthy rental incomes is the preferred approach. Source of article - Vulture investors move from flippers to landlords in down market by Personal Money Store.

Vulture investors scavenge what remains of housing market

Vulture investors earned the name by swooping down and snapping up distressed properties. CNN reports that places wracked with foreclosures and short sales like Las Vegas, Phoenix and Miami are popular because home prices there have dropped as much as 70 percent. Vulture investors used to be known for flipping often and helping to bid up home prices to unsustainable heights. These days, potential rental profits are looked at as the more stable long-term strategy. Today, vulture investing may serve as more of a stabilizing force for neighborhoods.

Vulture investing changes with the times

Several factors presently occurring in the U.S. housing market have changed vulture investing strategy from buyer and seller, to buyer and landlord. Mortgage resource HSH.com said ever-rising home prices, the meal ticket for house flippers, are a distant memory. It no longer pencils out to purchase cheap and sell cheap. Plus, millions of foreclosed borrowers have to wait years before they can purchase again have no choice but to rent, often from vulture investors who bought the properties for pennies on the dollar.

Money flow the primary attraction for vulture investors

By paying in cash, rental returns start rolling in right away for vulture investors. Las Vegas, where prices have fallen nearly 70 percent and rents have only dropped about 20 percent, is held as an example within the CNN article. Glenn Plantone, a vulture investor in Las Vegas, told CNN his net return on investment via cash flow is 12-to-14 percent . The beauty of cash flow is that if real estate values continue to fall, the return for the vulture investor holds steady.

Further reading

money.cnn.com

blog.hsh.com