Bloomberg - Wall Street is taking aim at the $34 trillion tied up in US homeownership, pouring money into contracts that offer homeowners cash upfront in exchange for a share of future appreciation.
- For investors, home equity investment contracts offer a lucrative way to tap Americans’ vast housing wealth, turning property stakes into a tradable asset to satisfy growing demand for exposure to US real estate.
- For homeowners, however, the deals can mean giving up a substantial share of future gains that would otherwise build long-term wealth—and in some cases repaying far more than they originally received.
- The rapid growth in HEIs reflects a rare convergence: years of rising home prices have left owners sitting on record levels of equity, while higher mortgage rates have made it harder to borrow against their properties.
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