Can Blackstone Balance the Real Estate Market With $6B Housing Bet?
In the latest deal, Blackstone Group Inc. (NYSE:BX) is getting in on the housing craze. The investment firm has purchased a leading company in the rent-to-own space at a crucial time when the median U.S. existing home price is up 24 percent from a year ago. Blackstone has acquired Home Partners of America, which is a nationwide company that owns 17,000 single-family units. The business purchases homes , prepares them, and rents them out to tenants who have the option of eventually purchasing the home. The business model increases profits for the real estate company and keeps the rental market filled. Blackstone bought 17,000 homes to get in on high real estate returns  *Blackstone Agrees to Pay $6 Billion for Home Partners of America    *Blackstone Acquiring a Firm That Buys and Rents Out Single-Family Homes    *Home Partners of America Owns Over 17,000 U.S. Homes$BX  *Walter Bloomberg (@DeItaone) June 22, 2021  It isn't a surprise that Blackstone got in on the home buying craze. The demand for homes has increased dramatically over the last year and a half. As of April 16, the demand for U.S. single-family homes was 3.8 million above the available supply. The home shortage is a 52 percent increase from 2018. Most of the shortage is driven by the COVID-19 pandemic, during which home sales surged as families sought safety within their own spaces. However, experts say that the strong demand and price points aren't going anywhere, at least not anytime soon. Article continues below advertisement  Blackstone's acquisition of Home Partners of America drives this point home even more. Given that the investment firm has a $118 billion market cap, the bullishness regarding real estate is a buy signal for many investors. Stephen Schwarzman, the CEO and co-founder of Blackstone, said in an interview, "It also presents a lot more opportunities because prices are higher, more people will sell. What we want is, because we're fundamentally in the private markets, that the only reason to buy something is to make it much better."