This sounds a lot like the collapse of a pump and dump:

Rents collected on the collateral for the first U.S. rental-home securities declined by 7.6 percent from October to January, according to Morningstar Inc.

Payments declined as expiring leases and early tenant departures left residences backing the bonds of Blackstone (BX) Group LP’s Invitation Homes vacant, Becky Cao and Brian Alan, analysts at Morningstar’s credit-ratings unit, said in a report. While 8.3 percent of the properties were vacant or occupied by delinquent renters in January, renewals on 78.5 percent of leases that expired the prior month exceeded the analysts’ expected rate of 66.7 percent.

The deal’s performance is being watched as Wall Street bankers and institutional property investors seek to follow Blackstone’s $479.1 million transaction in November with additional offerings. Initial lease expirations for the 3,207 homes are scheduled to peak from January through March, Morningstar said. To woo investors and rating firms in the new market, the transaction started with all of the units leased, unlike bonds backed by apartment-building loans.

They are claiming that this is going to improve, but these protestations of improving prospects sound awfully hollow.

Understand that this is in some way even scarier than what they did with the alphabet soups like MBS and CDS, because these psychopaths are now responsible for fixing things like broken heaters, plugged drains, etc.

There are already anecdotal reports that the banksters are horrible landlords (big surprise), and one wonders what is going to happen when tenants start suing them or organizing rent strikes.