Blackstone

It was a rare lucrative business for Wall Street in the aftermath of the financial crisis: snapping up properties in foreclosure and renting them out. So good, in fact, that now, as the distressed pool dries up, some investors are refusing to let the rental-model fizzle.

U.S. securities regulators are investigating whether bonds backed by single-family rental homes and sold by Wall Street's biggest residential landlords used overvalued property assessments.