Since the housing bubble burst, the Multifamily Housing industry has had to deal with a new competitor: The rental home.
While renting a home has always been an alternative to renting an apartment for many prospective tenants, the economic downturn coupled with the depreciation of home values has led to many IRO's(Independent Real-Estate Owners) leasing their homes at well below market rates.
This well documented trend has taken an even newer twist. Fannie Mae just announced that they will now rent foreclosed homes to the borrowers in order to allow the family to stay in their own home.
Fannie will benefit because they can sit on the asset as opposed to re-releasing it into an already saturated market. The former home owner can benefit because they do not have to incur a moving cost while money is tight.
What does it all means for the Multifamily Industry? We have a new competitor in Fannie Mae.
Many apartment owners have been hedging on the Foreclosure market to drive a whole new demographic of renter in the door. This will be something interesting to keep an eye on.
You can see the whole article here
Well the lesson that our governmernt refuses to learn---you can't bail out every horrible situation that is plaugeing society today... and by trying to save this bad situation you are putting a band aide you only slow the bleeding not stop it. What will happen to the many mulit family communities that go into foreclosure.... Section 8 government housing? That scares me.
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