FROM BUYER to FORECLOSURE to RENTER.

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Many strange things have happened these past few years but here’s one of the most interesting.

John Doe, his wife, and 4 children live in a small city North of San Francisco and had rented till around 2006 when they bought a nice house with more space than they had ever had. All was well till John lost his job in 2009, and 10 months later lost his house to Foreclosure.

He now lives in that same house as a Renter paying $1,800/month rent versus the $2,500/month and mortgage he previously paid as its owner.

This is the result of new type of Real Estate Investor buying multiple Bay Area foreclosed homes to be rented both for short term profit, and long term Capital Gains.

In this case the Investor is McKinley Capital Partners who have joined with a New York hedge fund who have so far bought about 300 homes and plan to add up to 500 more.

Some very basic research has shown me that this process is replicated in many other markets where the values have stabilized and an upward trend is very likely in the near future.

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