A four-bedroom home outside of Tampa, Florida, sold at a significant loss this week.
Blackstone, the property's owner, purchased the home for $490,000 in April 2022 and sold it on Wednesday for just $360,000—a sharp decline of $130,000, or roughly 27 percent.
Why It Matters
The sale occurs amid a broader correction in Florida's housing market and widespread price declines.
According to Zillow data, homes in the property's ZIP code have an average value of $410,206, down 1.6 percent year-over-year, indicating a minor correction. Further, home listings in the area increased significantly, which can bring down listing prices due to heightened competition.
This transaction points to challenges even large institutional investors like Blackstone, a global investment management firm worth upwards of $200 billion, encounter.
What To Know
The property, a 2,217-square-foot home built in 2020, is located in Wesley Chapel, a suburb roughly 25 minutes outside of Tampa, Florida.
Situated at 31850 Barrel Wave Way, the home was likely part of a larger strategy by Blackstone to invest in single-family homes for rentals.
According to a CNBC report, the firm has been criticized for its significant acquisitions of residential properties, which some argue distort the housing market and impact availability.
Nick Gerli, CEO of Reventure App, wrote on X, formerly Twitter, "[Blackstone] bought it at peak of bubble in 2022 to rent it out. But renting it was harder than expected. So they liquidated the property."
Per Gerli's post, Blackstone, through a subsidiary under the Home Partners of America brand, operated a rent-to-own model. This involved purchasing houses to rent with an option for renters to buy. However, the business model appears to have faltered, leading Blackstone to liquidate a significant portion of the Home Partners portfolio, particularly in Florida.
He noted the price reduction is in part due to Florida's ongoing housing market correction.
"...Upon further inspection, you can see why Blackstone had to cut the price. The inventory of homes for sale in their ZIP Code (33545) had spiked to 219 listings. Which is by far the highest level going back the last decade. Such high inventory is now putting downward pressure on prices," Gerli wrote.
Per the listing, the home sat on the market for around 250 days. Zillow notes the average time on the market for the property's ZIP code is 53 days.
What People Are Saying
Robert Washington, a broker at Savvy Buyers Realty based in St. Petersburg, Florida, told Newsweek: "I believe the Tampa market is already in the midst of a correction that started around 4 months ago. Many attributed the slow down to the hurricanes that hit, but I think there was already weakness brewing in our market. I absolutely think the stigma from the hurricanes contributed to the softness, but I think that high interest rates have been the true culprit.
We also experienced a substantial increase in prices from 2021-2023 and I think over the last year our market has taken a breather in order to come back to reality. We have started to see an uptick in buyer activity over the last few weeks which is promising, hopefully that will turn into sustained momentum."
Nick Gerli, CEO of Reventure App, told 10 Tampa Bay, a CBS affiliate: "The big takeaway is the Tampa housing market is entering into a bit of a correction, which is good news for home buyers. Expect to see in 2025, more homes for sale, more inventory, and cheaper prices across the metro."
Representative Ro Khanna, a California Democrat and lead author of the Stop Wall Street Landlords Act of 2022, said in a statement: "Homes should be owned by people, not wealthy corporate landlords who are buying up affordable single-family homes and pushing the dream of homeownership out of reach for ordinary Americans."
What Happens Next
As the market adjusts, the effects of large-scale investment by firms like Blackstone will likely remain a point of contention. The ability of these firms to absorb losses might provide opportunities for buyers, but it also raises questions about the long-term impacts on the housing market's stability and affordability.
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