Renting — The Foreclosure Solution

he Obama Administration has proposed a new strategy for addressing the large inventory of foreclosed houses: shift them to rentals. Currently, the administration is gathering ideas on how private entities could manage rental units or how units could be sold in bulk. This strategy would help stabilize neighborhoods in areas where high numbers of foreclosed properties have caused a decrease in property values.

Fannie Mae, Freddie Mac and FHA collectively own about 250,000 properties and the government wants to move those units to productive use through sales, partnerships or other strategies. While the options are being considered, the administration is exploring ways to manage them as rentals. The rental strategy has emerged because sales are slow and affordable rentals are difficult to find.