Saddled with almost a quarter of a million foreclosed homes, the federal government is looking for ways to turn the empty properties into rental opportunities.

 

The Federal Housing Finance Agency, the Department of Housing and Urban Development and the Treasury Department are turning to the private sector for ideas to sell, partner or create other strategies to help unload 248,000 homes owned by Fannie Mae, Freddie Mac and the Federal Housing Administration. The properties in question represent about half of all those that have been foreclosed upon and are still awaiting resale across the country.

 

By making the foreclosed properties rentals, the Obama administration would not only relieve itself of the buildings, but also expand the rental market. With so many Americans renting right now, rents have soared. A study out of Harvard showed that 10 million people (26% of renters) are paying more than 50% of their income in rent.

 

Skeptics of the idea wonder if turning foreclosures into rentals is so promising, as Washington would like to think, then why aren’t investors already doing it? And if big corporate investors do buy into the idea, can they be trusted to maintain the properties in a better than shoddy manner.

-Noel Brinkerhoff

 

Can Turning Foreclosures into Rental Properties Save the Housing Market? (by Lois Beckett, ProPublica)

U.S. Seeks Ideas on Renting Out Foreclosed Property (by Edward Wyatt, New York Times)

Affordable Rental Housing Scarce in U.S., Study Finds (by Dina ElBoghdady, Washington Post)