What happened when a private equity firm became the biggest homeowner

Source: Todd Frankel & Dan Keating, Washington Post (Paid Registration)

Nationwide, single-family homes — symbols of the American Dream — are increasingly owned by far-flung investors. These homes are offered to local residents only as rentals, reflecting a profound shift in who profits from homeownership today.

Since the 2008 financial crisis, no major city has suffered a bigger percentage drop in owner-occupied single-family housing than Memphis, partly the result of predatory mortgage lending giving way to a flood of foreclosures.

Now, many of these homes are owned by investors, including Cerberus, a firm specializing in distressed assets. It uses unusually aggressive tactics to recover late rent. The property manager it owns and operates, FirstKey Homes, files for eviction at twice the rate of other rental home property managers in the Memphis area.

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