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""Fannie Mae"":http://www.fanniemae.com has put a block of 2,490 REOs up for sale. It's the first pilot transaction of the federal government's Real-Estate Owned (REO) Initiative announced in August 2011, which aims to sell homes repossessed by government agencies to private investors for the purpose of turning the properties into rental units.
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The properties are concentrated in the hard-hit metropolitan areas of Atlanta, Chicago, Las Vegas, Los Angeles, Phoenix, and parts of Florida. Nearly a quarter are located in L.A., 21 percent in Atlanta, and 15 percent in Southeast Florida.
Of the 2,490 single-family properties up for grabs, only 429 are vacant. The remainder are currently occupied by
[COLUMN_BREAK]tenants, giving the winning bidder an established line of rental income already.
Only investors who have completed the pre-qualification process, as stipulated by the ""Federal Housing Finance Agency"":http://www.fhfa.gov (FHFA) will be able to bid on the portfolio. Interested bidders must submit applications to demonstrate their financial capacity, experience, and specific plans for purchasing pools of Fannie Mae foreclosed properties with the requirement to rent the purchased properties for a specified number of years.
Any investors interested in the pilot program who have not prequalified may still do so by completing the appropriate forms available online through the ""FHFA REO Initiative"":http://www.fhfa.gov/Default.aspx?Page=360 page of the agency's website.
Credit Suisse is Fannie Mae's financial advisor on the pilot transaction and has issued a ""high-level prospectus"":http://www.fhfa.gov/webfiles/23402/FNMASFRREO2012-1SummaryofAssets.pdf on the assets up for sale. Investors who post a security deposit and sign a confidentiality agreement will be privy to more detailed information about the properties.
""This is another important milestone in our initiative designed to reduce taxpayer losses, stabilize neighborhoods and home values, shift to more private management of properties, and reduce the supply of REO properties in the marketplace,"" said Edward DeMarco, FHFA's acting director.
