Friday, May 25, 2012

Yep, the money's in the landlord business again.

@Housingwire has pulled some gist from a report by the Federal Housing Finance Agency's Inspector General with the defensive title of "Fannie Mae and Freddie Mac: Where the Taxpayers' Money Went."

The said gist is that Fannie and Freddie have only started making money again in one way, and that's from "multifamily" housing, which is to say, apartments and condos. Which is to say that, after a bizarre interlude of suburban houses blossoming into tulips, we're returning to a more economically ordinary state in which center cities are popular places to live and being a landlord is a more sensible sort of investment than investing in home loans.

Not that the report says so prominently. For the work of an inspector-general, it's a bit busy being defensive, saying those billions really did go to plug a hole usefully. Might have been written in haste. Full of clompy diction, e.g., "Like with their single-family business, the Enterprises participate in mortgages secured by multifamily buildings..."

It reads like a simplified explainer on the wreckage we've been hearing about all along. There's an introductory note that it was distributed to all of Congress. Two headlines attempt a summary near the end: "Losers: Stockholders" and "Winners: Holders of Bonds and Guaranteed MBS." A bit simple, that.

Wonder who asked for this in a hurry and why.

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