Blackstone Group has poured billions into real estate in the past few years, but the U.S. housing market has lost its "big pop" as an investment option, CEO Stephen Schwarzman told CNBC on Wednesday.
During an interview on "Squawk Box," Schwarzman said home prices price in some markets spiked as much as 20 percent in recent years but now investment returns on home prices have settled somewhere between 5 and 10 percent.
"That's just great, but it doesn't justify us buying at the same rate," said Schwarzman, whose firm has bought $7 billion to $9 billion worth of individual homes,
Schwarzman said he's content to limit his exposure at those levels.
"We think a lot of the big pop in housing has gone out," he said.
Asked whether Blackstone's big position in real estate helped drive up prices following the subprime mortgage crisis, Schwarzman said the investments have most likely affected only smaller markets where their home purchases have been focused.
"We're in effect a bit player in a very massive market, and the laws of supply and demand are really what drive housing," Schwarzman said.
—By CNBC's Jeff Morganteen. Follow him on Twitter at @jmorganteen.