The Obama administration proposed a plan last week to pull foreclosed homes belonging to Fannie Mae and Freddie Mac off the real estate market and rent them out, according to a report in the Wall Street Journal.
The idea behind the plan would be to clear out the glut of unsold properties on the market and perhaps prevent the continued downward trend in real estate prices.
Federal Reserve Chairman Ben Bernanke said in a testimony to congress that the idea would be “worth looking at.”
While the proposed plan would develop a new and unpredictable element by turning the federal government into a landlord, it would enable the government to recover some costs as rent prices continue to rise across the country.
Many local homeowners unable to recover their investments in the real estate market have turned to the rental market as well, renting their homes out until the market improves.
See related story: http://csbj.com/2011/07/22/where-homeowners-turn-when-they-cant-sell/