It was just about a year ago that Warren Buffett told CNBC's Squawk Box that he believed single family homes were such a great investment that he longed to buy thousands of them himself, and that as a long-term investment, he thought these houses represented a better investment than stocks.

Well, the great man is seldom wrong, and even when he is -- as when he prematurely called the housing rebound -- he's not far off. The new investment mania that has kept the Blackstone Group (NYSE: BX) so busy over the past year or so, and has spawned a new breed of mortgage REIT in Silver Bay (NYSE: SBY) and Altisource Residential (NYSE: RESI), has now gone global.

Foreclosure frenzy
In addition to homegrown companies like those above, foreign investment has also been sniffing around these foreclosed homes, and they're smelling money. The Wall Street Journal reports that investors from as far away as Australia are snapping up properties in Jersey City, New Jersey, and Tricon Capital Group, a Toronto, Canada-based asset management company, has grabbed almost 2,000 houses in hard-hit states like California and Florida.

Even Silver Bay, spun off from hybrid mREIT Two Harbors (NYSE: TWO) -- which had the foresight to see this trend coming -- has non-domestic cash in its coffers. The Journal notes that Canadian and European interests make up five of the top 20 institutional investors of that particular entity.

Banks, private REITs jump in, too
Big banks haven't turned a blind eye to this trend, either. JPMorgan Chase's (NYSE: JPM) private bank has set up a partnership that allows wealthy clients to invest in single-family rentals in states that suffered heavily during the housing bust, promising returns topping 8% annually.

Private REITs are getting in on the act, as well. B.Wayne Hughes, the founder of Public Storage, has put up pots of money to purchase such homes through his American Homes 4 Rent unit. In partnership with the Alaska Permanent Fund, through which Alaskan residents receive their annual oil royalty checks, Hughes' company has gobbled up about 10,000 houses in distressed areas. This puts American Homes right behind Blackstone, which is currently the biggest player in this arena.

Enough to go around?
While this business is currently wildly popular and lucrative -- Hughes' company predicts annual returns of 6% to 7% -- it makes me question whether the demand for distressed homes might not outstrip the supply. For example, Silver Bay has done pretty well since its IPO last December, showing a 10% stock jump so far this year, while peer Altisource Residential has been somewhat inert.

The other question concerns the housing market itself. While many of these investors plan to flip these houses once housing prices start picking up, I wonder how they will refill their stables if the supply of foreclosures dries up.

Despite the plug from Buffett, investors here at home should keep in mind an oft-repeated axiom from the great man: "Be fearful when others are greedy, and greedy when others are fearful." It's just possible that this red-hot investment fad may turn cold in a hurry.