A company from California specializing in converting foreclosed homes into rentals has entered Chicago's market.

By Peter Ricci

A housing company specializing in converting foreclosed properties has just entered the Chicagoland market with its first purchase in Aurora, according to a new report from the Chicago Tribune.

Waypoint Homes, a California firm, owns more than 1,800 homes in the Golden State, and it plans to buy up to 100 homes a month for the next 12 months throughout Chicagoland, said Doug Brien, the co-founder and managing director who was a place-kicker for the Bears in 2005.

Waypoint’s strategy, as the Trib explains, is simple: buy single-family foreclosed homes in areas where the economy is strong enough to foster a stable rental market. The company is highly selective (it ultimately purchases only 3 percent of the homes it views), and in Chicago, it expects buys properties in the price range of $80,000 to $160,000 and rent them from $1,300 to $2,000, often to former homeowners.

As we’re reported before on the FHFA’s foreclosure-to-rental initiative, there is considerable money in the burgeoning market for home rentals (CoreLogic has put the total in the billions of dollars), and as the Trib notes, there could be as many as 132,000 foreclosed properties in Chicago.

“There’s a lot of competition and money coming into this space,” Brien said in the Tribune article. “Inventories are shrinking and prices are going up. We’re certainly coming in (to the Chicago market) earlier relative to when we’ve entered other markets, like Phoenix. Here we feel like we have a chance to expand and build a meaningful presence.”