With all the sales of distressed homes at huge discounts, it’s no secret that builders are struggling to compete with them. But rather than sit their complaining and moaning, at least one national builder has decided to take advantage of the situation.
For the last 12 months, Beazer Homes USA has responded to the housing crisis by snapping up hundreds of distressed homes, renting these properties out in the hope that one day, some of these renters may be able to buy the homes they are living in.
The hard-hit cities of Las Vegas and Phoenix have been the focus of Beazer Homes’ novel new business strategy, according to a report in Builder Online. In these two cities, the builder has snapped up dozens of distressed homes lying in a poor state of repair, before doing them up and advertising them for rent.
In line with this new policy, the builder has decided to create a new subsidiary called Beazer Pre-Owned Rental Homes Inc. (BPRH), which will act as a real estate investment trust tasked with furthering the growth of the company’s new rental business.
Allan P. Merrill, Beazer Homes USA CEO, told Builder Online that the company’s investment in BPRH would allow them to grow their new rental homes business much more rapidly:
“BPRH’s ability to focus specifically on the rental homes market and attract external capital to scale the business represents a compelling—and differentiated—value for our shareholders,” explained Merrill.