Blackstone (BX), the largest investor and owner in real estate, is bullish on the U.S. housing market, and it comes down to simple math.
“If you go back, over time, we need about [1.5 million or 1.6 million] homes built in the US to keep up with population growth, household formation,” said Jon Gray, Blackstone’s head of real estate. “The last 12 months, we have built 1.1 million, and we’ve been under-building housing now really since the crisis.”
That’s why home prices last month were up 6% in the U.S., Gray added.
Following the crisis, Blackstone went out and purchased 50,000 homes and renovated them and leased them. Blackstone’s housing platform, known as Invitation Homes (INVH), is more than 95% occupied today.
“It’s a really a simple business based on providing great service to the underlying tenants. And the fact that today there’s just a shortage of housing and we think that’s very supportive for the future of these businesses.”
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Julia La Roche is a finance reporter at Yahoo Finance. Follow her on Twitter.
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