Foreclosure Prevention Act Gets Mixed Reaction from Multifamily Industry

By Anuradha Kher, Online News EditorWashington, D.C.–The Foreclosure Prevention Act of 2008 (S. 2636), recently passed by the Senate, has received mixed reaction from the multifamily industry. The Act provides $3.92 billion in emergency funding to enable states and cities to work with local nonprofits to acquire and rehabilitate foreclosed homes.“The passage of the Foreclosure Prevention Act will help mitigate the growing problems brought on by the foreclosure crisis,” says Doris W. Koo, president and CEO of Enterprise Community Partners. “Productive occupancy of foreclosed homes will help stimulate economic activity and help prevent further loss of home equity in struggling neighborhoods.“The Foreclosure Prevention Act addresses the growing impacts of the foreclosure crisis, including lost homeowner equity, decreased property values and tax revenue; increased blight and greater criminal activity,” says Koo. Enterprise believes that the $3.92 billion emergency funding to state and local governments–included in the bill–can be used by housing and community development organizations to purchase and rehabilitate foreclosed properties.But the National Multi Housing Council (NMHC)–which supports any help to those in danger of losing their homes–believes that the current problems in the housing market go beyond what is addressed in this bill. “All the efforts in the bill go toward re-stimulating the housing bubble, a market that was too heated,” Jim Arbury, senior vice president of government affairs at NMHC, tells MHN. “This reminds me of the time right after post 9/11. If the goal is stimulus, the government should consider investing in other markets.”Arbury wonders why the government wants to put all this money into the housing market, which he says, is overbuilt. “Why housing, as opposed to so many other things, like the country’s infrastructure?” asks Arbury.