In Depth Analysis: CalculatedRisk Newsletter on Real Estate (Ad Free) Read it here.

Tuesday, July 19, 2011

Report: No Plans for another Large Housing Program

by Calculated Risk on 7/19/2011 01:48:00 PM

There was a report last week from Nick Timiraos at the WSJ: U.S. Tackles Housing Slump that "The Obama administration is ramping up talks on how to revive the housing market".

From Renae Merle at the WaPo: Obama administration not planning another big housing program

The Obama administration has no plans to introduce another large-scale program for relieving the troubled housing market, despite the president’s recent admission that his past efforts have not solved the problem, according to a senior administration official.
“There is no money and, to some degree, we have run out of ideas. I have seen them all,” said Mark Zandi, chief economist of Moody’s Analytics. “I don’t think there is something grand that could make a big difference.”
The biggest opportunity for wide-ranging change may be a settlement being negotiated between a coalition of state attorneys general and large banks related to flawed foreclosure practices, industry officials and consumer advocates say.
Unfortunately most of the programs so far have fallen short of expectations (HAMP) or were misdirected (Housing Tax Credit).

Some of the new policy ideas being discussed - like converting some delinquent homeowners to renters using a deed-in-lieu of foreclosure, then placing the property under the current REO Tenant-in-Place Rental Policy1 - and finally selling the property to investors with tenant-in-place - had some merit. But it appears there will won't be any new programs, except maybe a little something from the servicer agreement.

1 The current REO Tenant-in-Place policy is to protect tenants of foreclosed investor owned property.