Short Sale Soundoff: FHFA announces next steps in REO Pilot Program
The FHFA, Federal Housing Finance Agency, announced yesterday that the winning bidders in a REO pilot initiative have been chosen and transactions are expected to close early in the third quarter. The FHFA said that market response has been robust with strong qualified bidder interest.
“FHFA undertook this initiative to help stabilize communities and home values in areas hard-hit by the foreclosure crisis,” said Edward J. DeMarco, Acting Director of FHFA. “As conservator of Fannie Mae and Freddie Mac, we believe this pilot program will assist us in achieving our objectives and help to maximize the benefit to taxpayers. We are pleased with the response from the market and look forward to closing transactions in the near future.”
FHFA launched the pilot program in late February, and in the second quarter bids were solicited from qualified investors to purchase approximately 2,500 single-family Fannie Mae foreclosed properties. Fannie Mae offered for sale pools of properties in geographically concentrated locations across the United States.
Investors were qualified to bid after a rigorous evaluation process and were evaluated on the basis of several factors, including financial strength, asset management experience, property management expertise, and experience in the geographic area.
C.A.R. is disappointed that the FHFA ignored overwhelming economic data showing that such a program is not necessary, especially in California where inventory levels are exceptionally low, and may potentially harm the housing market in certain areas.