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Showing posts from February, 2012

Dining with Vultures: Rento-to-Own, the Feds and the Housing Sector

Dining with Vultures: Rent-to-Own, the Feds, and the Housing SectorBy Jay WeiserWednesday, January 25, 2012 Filed under:Economic Policy Distressed asset buyers are either ruthless or go bust, and government entities have no business co-venturing with them.
Rent is suddenly the rage for solving the housing debt crisis—and vulture capital with it. But the ambivalence conjured up by private equity magician Mitt Romney, who has simultaneously restructured himself into the leading Republican presidential candidate and America's most reviled business leader across the ideological spectrum, suggests that the housing crisis requires free and clear, as-is sales, even if they increase short-term losses. The federal government should exit the real estate business and let vulture investors convert busted planned communities into rentals.
The Federal Reserve estimates in a white paper that there were about 500,000 real-estate-owned properties for sale in the second quarter of 2011 (REO is the ter…

Rent-to-Own, the Feds and the Housing Sector

Rent-to-Own, the Feds and the Housing SectorGovernment-sponsored enterprises Fannie Mae and Freddie Mac, under the guidance of the Federal Housing Administration (FHA), are looking for options to unload their large portfolios of distressed real estate properties. Specifically, real-estate-owned (REOs) properties -- properties where mortgage lenders have taken ownership after default -- are a growing class of assets that the FHA is hoping to partner with the private sector in order to unload, says Jay Weiser, an associate professor of law and real estate at Baruch College's Zicklin School of Business.
The Federal Reserve estimates in a white paper that there were about 500,000 real-estate-owned properties for sale in the second quarter of 2011.It also suggested that there will be potentially 1 million more foreclosures in 2012 and 2013, which will further expand this class of assets.As these properties lie empty without investors to maintain their upkeep, their value automatically …