The world’s largest alternative asset manager is now its largest landlord. Why Blackstone is taking over US rentals — and what it means for housing

The multinational has been on a buying spree, taking over apartment giants Tricon Residential and AIR Communities along with American Campus Communities, which develops and operates student housing nationwide.

That’s on top of all the mobile home parks and single-family homes Blackstone has bought up and turned into rent-generating properties for its profitable portfolio. As CNBC reports, Blackstone owns over 274,000 rental homes in the U.S. alone.

Here's what’s behind Blackstone’s strategy and what it means for renters, homebuyers and lawmakers.

"What we’re saying is don’t have private equity buying up single-family homes." Rep. Ro Khanna told CNBC.

Private equity’s impact on housing affordability

The housing affordability crisis plays a role in Blackstone’s strategy to turn residential buildings into big-time investment properties. Demand for, and profit from, rental properties continues to grow as more potential homebuyers are priced out of the housing market.

That’s particularly true in the urban centres Blackstone is targeting in places like New York, Texas, Florida, Georgia, and other Sun Belt States.

The firm is purposefully buying, not building, rental properties. That’s because — as Will Pattison, head of real estate research at MetLife Investment Management, told CNBC — “buying is still cheaper than building in many markets.”

“This is limiting construction and supporting rent growth,” he added.

There are widespread concerns that private-equity investors like Blackstone are reducing supply, causing house prices to spike and driving people to rent — exacerbating the very housing crisis from which they benefit.

Blackstone is certainly not the only private equity firm engaged in this strategy. CNBC reports that private-equity firms started buying cheap foreclosures after the 2008 housing crash and are still buying up single-family homes to turn into rentals.