White House is Planning to Rent, Sell or Dispose of Foreclosed Houses
Photo by Woodleywonderworks
The White House is trying to prop up the failing real estate market, which has hardly showed any signs of recovery from the shock of the 2008 credit crisis. The Obama Administration is planning to rent, sell or dispose of foreclosed houses that are under the control of the government.
The regulator of Freddie Mac and Fannie Mae, the FHFA (Federal Housing Finance Agency), as well as the Treasury and Department of Housing and Urban Development (HUD), said that they were willing to cooperate with this move. All these agencies are trying to reduce the number of foreclosed houses as well as boost up prices through giving incentives for renting out or selling properties under the ownership of Federal Housing Administration, Fannie Mae and Freddie Mac.
The target is to either sell or rent out properties in clusters in the hope that it “may reduce taxpayer losses and meet the enterprises responsibility to bring stability and liquidity to housing markets” said Edwar DeMarco of FHFA (acting director).
From the very start of his tenure, Obama has been battling to put the housing market on its own two feet. Unable to tackle the rush of defaults, Fannie Mae and Freddie Mac were brought under the wing of the U.S. federal government. Since September 2008, both the agencies have survived on government aid. To remain solvent, the Treasury has given assistance to the tune of $170 billion.
With his reelection looming large, Obama has not been able to show much tangible results for his attempts. The government program, HAMP (Home Affordable Modification Program), has been of help to nearly 650,000 troubled homeowners; it is a far cry from the original target of the program to help 3 million to 4 million house owners.
Keith Hennessey, former director of National Economic Council, during the tenure of President George Bush said, “In the 2008 campaign they said the president would come in and fix the housing problem. We literally couldn’t see a way that policy could solve the problem. I think they’ve figured that out now”.
The latest announcement by the government shows that there has been a shift in government policies from focusing on keeping the house owners in their homes to concentrating on the future of the units whose owners were beyond help.
