Obama administration officials, FHA and HUD put out a “request for information” on Wednesday, August 10, 2011. They are looking for new ideas to reduce the Billions of foreclosed properties held by these mortgage finance giants that are causing problems with housing market and hurting prices. This request is open to comments through September 15, 2011.
They are looking for private partners to remove as much as $30 billion in single-family real estate owned properties (REOs) that are currently on the books of Fannie, Freddie, and FHA. Among the ideas which were floated, is turning the foreclosed properties into affordable rental homes. In their opinion, this would encourage private investors to invest in local housing markets and eventually stabilize prices.
Unfortunately, there is no allowance for the smaller, local community investor, because the administration will only consider private-equity funds, financial institutions, and perhaps local governments and nonprofits as investors at this point.
Another idea being considered is allowing an investor to partner with Fannie Mae and Freddie Mac in a joint venture to buy a pool of converted rental homes. If nd when these homes are sold, there would be some sort of equity split between the mortgage giants and investors, to help to reduce the government’s mounting losses.
However, in our experience, there is usually quite a few restrictions when working with the government, in any capacity! Seems like they are just grasping at straws, at this point!
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