Renting Out Government-Owned Foreclosed Properties Will Benefit Economy

Renting out government-owned foreclosed properties will generate much-needed revenue for the government, expand the quantity of energy efficient, affordable housing to thousands of American families, and create well-paying jobs.

Part of a Series

Idea of the Day

Idea of the Day

The announcement yesterday that the Obama administration will consider proposals to sell off large numbers of government-owned foreclosed homes is an important step toward a new system of U.S. housing finance. If designed well, this initiative could generate much-needed revenue for the government, expand the quantity of energy efficient, affordable housing to thousands of American families, and create well-paying jobs.

Government-supported entities own hundreds of thousands of foreclosed homes, mostly from mortgages insured before the housing bubble burst. These owners include the Federal Housing Administration, Fannie Mae, and Freddie Mac. Most of these so-called “real-estate owned” or “REO” properties are currently unoccupied and losing value as they deteriorate.

The White House addressed this issue yesterday by releasing a public solicitation for proposals on how to deal with this growing stock of REO properties. Their goal is to reduce the number of foreclosed homes in a way that minimizes taxpayer losses, expands affordable housing, and addresses property repair and rehabilitation needs.

For more on this topic, please see:

Renting Our Way Past the Home Foreclosure Crisis by David Min, Jordan Eizenga, and John Griffith

The positions of American Progress, and our policy experts, are independent, and the findings and conclusions presented are those of American Progress alone. A full list of supporters is available here. American Progress would like to acknowledge the many generous supporters who make our work possible.