photo credit: maubrowncow
In January of this year, the government had plans to purchase all of Fannie Mae, Freddie Mac, and the FHA's distressed properties, then rent them out. Loren Berlin, writer for the Huffington Post, explains some of the problems that Goldman Sachs sees with this potential rental program. Some of the properties would still remain vacant because no one would want to rent them. Nearly half of the properties on Fannie Mae and Freddie Mac's books are simply unsuitable for rental. Berlin also pointed out that if the distressed properties were indeed turned into rentals, it wouldn't cut the number of homes on the market, because lenders would just replace these houses with others from their inventory. This idea brings up an important question -- if these properties would make good rentals, why haven't they already been snapped up by investors?
