The title of this post is not merely some rhetorical query posited by your humble author, it is also the subject of a recent Request For Information (RFI) promulgated by a trio of US government agencies. For those unfamiliar with such things, an RFI is essentially an open request made by a government agency for answers to a specific question from those with a stake in the outcome.
In this case, the Treasury Department, The Department of Housing and Urban Development and the Federal Housing Finance Agency have jointly put forth an RFI with the intent of sounding out investors on the most palatable ways to sell-off the thousands of residential properties the US government owns.
For anyone surprised by the last sentence of the previous paragraph, the government does indeed own a sizable number of homes after its bail outs of Fannie Mae and Freddie Mac gained it de facto ownership of any properties those entities foreclose on. Though some of our readers might not be fans of this situation, there is not much that can be done about it now except to find an efficient resolution.
So what is an efficient solution to the problem? That is, in essence, what the government wants guidance on. The main scenario it wants to avoid is selling the properties off at auction. Homes sold at auction would likely be sold below market, and below market prices in those transactions would impact comparables, causing a trickle down which, at the extreme, could lead to a new round of housing market problems.
Rather than risk this outcome, the RFI instead asks investors to explore alternative plans. The RFI gets potential responders started with a few suggested strategies to ponder including lease-to-own plans and potentially converting the homes to government-owned rental units. This latter plan could potentially have the dual impact of providing relief to a strained national rental market and establishing a new title for the President; Landlord-in-Chief does have a certain ring to it...
For more on the RFI, visit the Treasury Department's press release on it here and an AP story on it here. Meanwhile, anyone interested in throwing their hat in the ring with a killer idea to save the US housing market can find details on the submission process in the RFI itself here.