Morgan Stanley: America needs housing investors to buy in bulk

A recent report from Morgan Stanley showed the company would like to see investors purchase REO properties in bulk on the housing market, as it would help out the residential housing market, according to Bloomberg.

The move could lower the surplus of homes in the United States, which would then help regulate the housing price situation and provide an increased number of rentals to many consumers. In order for this to happen, tax breaks would need to be given to these potential investors, the news source reported. In addition, eased lending terms may also help encourage investors.

"Mortgage credit remains tight, making home purchases more difficult, while rental demand is accelerating, causing rents to rise quickly," analyst Oliver Chang and the other Morgan Stanley analysts explained, according to the news source. "If nothing is done soon, we will find ourselves in a situation where owner-occupied housing becomes unobtainable due to lack of credit, while rental housing becomes unobtainable due to rising costs."

Foreclosures are still a serious problem, as 2.2 million residential properties are already vacant, the news source reported.