Monday, September 27, 2010

Fannie bares her teeth |

Fannie bares her teeth | "Freddie Mac and Fannie Mae – the hillbilly kissin’ cousins of the nation’s secondary mortgage market – instituted a long-needed reform to the sale process of its REO (foreclosed) properties.� The “First Look” program gives buyers purchasing a primary residence for their own use, a 15-day head-start before investors can submit offers on the same property.

Nearly 18 months ago I met with the field staff of Congresswoman Susan Davis‘ office on this matter and I was glad to see both Fannie and Freddie get on board. The problem in a nutshell is this: Investors, including large syndicators began snapping up foreclosures at an astonishing rate converting large percentages of owner-occupied housing into rental stock.

What’s wrong with this picture? Well, if you’re a condominium owner or an HOA and your complex goes from 15% absentee-owner to 75%, the effects are immediate and profound. Wear and tear on the building goes up as the average length of occupancy plummets. Absentee-owners tend to vote against assessments and improvements looking strictly for profits. Similarly, they may have fewer concerns about adhering to notions of ownership pride and upkeep."

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