HOW SOME BIG INVESTMENT FIRMS ARE READYING HOUSTON FOR THE NEXT FLOOD Whether homes flooded by Harvey are sold to investors or not makes a big difference, argue the Chronicle’s David Hunn and Matt Dempsey. For one thing, a sale closes the door to a county buyout — which often takes much longer to complete than a private purchase. Since Harvey, the reporters note, 88 houses Harris County had hoped to buy and demolish have already been snatched up by private parties, often for rehab and rental. Investment firms, by the writers’ count, have bought about 150 Harvey-flooded homes so far. Since about 2013, larger firms have been bundling rental homes in order to “sell the securities on Wall Street as a way to borrow money, fueling the purchase of even more homes.” But by maintaining the supply of floodable housing, Harris County Flood Control District’s Matt Zeve tells the writers, “All we’re doing is perpetuating a cycle of flooding.” At a national scale, according to university researchers quoted by Hunn and Dempsey, “rent-backed loans are already exhibiting characteristics of mortgage-backed securities” — the keynotes of the 2008 U.S. financial mess: “they’ve transferred the risk of default to taxpayers, stockholders and investors.” But investors seeking info about such rent bundles may be hard-pressed to get it: “While U.S. securities laws require funds to disclose significant risks about their investments, there are no specific requirements regarding flooded homes.” Hunn and Dempsey’s review of documents put out by public companies invested in flooded Houston houses shows that few of them, “if any,” have voluntarily told shareholders that they own such assets. [Houston Chronicle ($)] Photo of Harvey cleanup in Bellaire: Russell Hancock via Swamplot Flickr Pool