The pilot bidding program for the FHFA’s REO conversion program has been extended by a month, possibly because of high demand.
According to a HousingWire article on the program, investors will now have until May to bid on the 2,490 foreclosed homes that Fannie Mae is offering for sale in Atlanta, Chicago, Las Vegas, Los Angeles, Phoenix and parts of Florida.
A spokesperson for the FHFA, quoted in the HousingWire piece, said the program was making progress – without confirming the new deadline.
“We are currently qualifying bidders,” the spokesperson said. “Qualified bidders will be notified as to the next stage of the process in due course during the evaluation of bidder qualification applications and up and through the bid date. Though we cannot speculate on your timeframes, the transaction continues to proceed as planned.”
Though no exact reason is known for the deadline extension, an investor hinted to HousingWire that the FHFA may be overwhelmed by the 300 to 400 private bidders competing for the REO properties, which recent analysis shows could prove incredibly profitable.
But regardless of the extension, an analyst at a policy think tank in Washington said the administration is extremely hopeful for the program.
“Administration officials have extremely high hopes for this program,” the analyst said. “They say this could be the most important program they’ve gotten off the ground since the foreclosure crisis struck.”
Originally announced in February, the pilot transactions for the REO Initiative targeted some of the hardest-hit metropolitan areas with the intention of converting vacant and distressed properties into rental units. Pre-qualified investors submitted applications to purchase pools of Fannie Mae properties in the aforementioned areas, though, in an interesting twist, competing GSE Freddie Mac began working on its own REO program independent of the FHFA.