Obama Administration Seeks Ideas To Reduce Foreclosure Inventory

Obama Administration Seeks Ideas To Reduce Foreclosure Inventory

It reads like  a personal ad in the Onion:

Overwhelmed, formerly ultra popular 50 -something desperately seeking ideas, from anywhere,  that will reduce inventory of foreclosed properties held by Fanny and Freddie.

That’s right, The Obama administration is looking for new ideas to shrink a glut of foreclosed properties held by Fannie Mae and Freddie Mac that are weighing down housing prices and depressing the national housing market. The only bizarre part is that they are looking outside the usual circle of White House advisers and experts.

The U.S. Treasury Department, the Federal Housing Finance Agency and the Department of Housing and Urban Development are considering alternatives including turning the foreclosed properties into rental homes.  A “request for information” by the administration doesn’t endorse a particular long-term option to stabilize the housing market but rather asks for input from those with private capital willing to work with the government on buying foreclosures and expanding access to rental properties.  The government is open to comments through September 15.  Obama administration officials said they were looking for private partners to remove as much as $30 billion in single-family real estate owned properties (REOs) that would be available for sale and are currently on the books of Fannie, Freddie, and the Federal Housing Administration.  Among possible investors, officials said they were looking for private-equity funds, financial institutions, and perhaps local governments and nonprofits to buy foreclosed properties and offer them as rentals in stressed housing markets.Another approach the White House is eyeing would allow investors to partner with Fannie and Freddie in a joint venture to buy a pool of converted rental homes, with an equitable split between the government entities and investors to reduce losses at the mortgage giants, Fannie and Freddie.

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Blog post compliments of CenterCityTeam’s Philadelphia Real Estate Blog

Frank L. DeFazio, Esquire
Prudential Fox & Roach Realtors – Society Hill
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