Pimco’s Kiesel Remodeling Home in Bet U.S. Prices to Keep Rising

Bloomberg reports:

Mark Kiesel, the Pacific Investment Management Co. bond manager who sold his home in 2006 before the U.S. property market collapsed, says he’s remodeling the house he purchased last year as he wagers prices will climb further.

The housing market may deliver “mid-single-digit annual gains for the next few years, particularly if low inflation allows the Federal Reserve to maintain accommodative monetary policy,” Kiesel wrote in a report published today on Pimco’s website. The world’s largest bond-fund manager is favoring “select investments” among homebuilders, appliance makers and banks, said Kiesel, the firm’s global head of corporate bonds.

Home prices are rebounding nationwide, buoyed by investors such as New York-based Blackstone Group LP that have acquired thousands of foreclosed homes at discounts before renovating and renting them. Kiesel, who rented for six years before buying a house in Newport Beach, California, where Pimco is based, said he’s has been repairing and remodeling the property over the past year and a half.