California Rep. Gary Miller — who’s getting major backing from the National Association of Realtors as he runs for reelection to Congress in a new district — has introduced a bill that would put the brakes on bulk sales of Fannie Mae real-estate owned (REO) homes in the state.
H.R. 5823, the "Saving Taxpayers from Unnecessary GSE Bulk Sale Programs Act of 2012," would prevent Fannie Mae and Freddie Mac’s regulator, the Federal Housing Finance Authority (FHFA), from implementing a pilot program to sell Fannie Mae-owned properties in California to institutional investors for conversion to rentals.
"We are hearing from our members that housing supply is extremely tight, with REO inventory being especially low at only a two-month supply," California Association of Realtors President LeFrancis Arnold said in a statement welcoming the bill’s introduction. Arnold said California home buyers "already are competing with small investors and encountering multiple offer scenarios."
Last month, 19 members of California’s congressional delegation sent a letter to FHFA objecting to bulk sales of repossessed homes to investors for conversion to rentals.
FHFA has said it will only approve bulk sales in markets where there’s no shortage of homes on the market. The first "REO to rental" sale of 2,490 Fannie Mae "real estate owned" (REO) properties will be limited to eight markets: Atlanta (572 properties); Los Angeles-Riverside, Calif. (484 properties); Phoenix (341 properties); Las Vegas (219 properties); Chicago (99 properties); Southeast Florida (418 properties); Central and Northeast Florida (190 properties); and Western Florida (167 properties).
Miller, a Republican who currently represents California’s 42nd Congressional District — which includes parts of Los Angeles, Orange, and San Bernardino counties — is seeking reelection in the 31st District, after his current district was redrawn in favor of Democrats.
According to Federal Election Commission filings, the National Association of Realtors has made more than $500,000 in independent expenditures to help Miller establish his name in the district he hopes to represent, which includes Rancho Cucamonga and Redlands.
NAR’s Congressional Fund this year has spent $136,314 on Miller’s behalf through the end of May, including $118,385 on a direct mail campaign. On May 9, NAR’s Realtors Political Action Committee (RPAC) dropped $396,000 on TV ads supporting Miller in the June 5 primary (the expenditure was reported twice, after it was originally filed as an expenditure in the 42nd District by mistake).
In the 2010 election, HR 5823 co-sponsor Rep. Ken Calvert, a Republican who represents California’s 44th District, was one of 11 Congressional incumbents to get six-figure backing in independent campaign expenditures from NAR. Calvert was reelected 56 percent of the vote, thanks in part to $606,236 in independent expenditures by NAR’s RPAC.
After the election was over, RPAC received a $207,732 refund for TV ads it bought in support of Calvert, but which never ran.
Other co-sponsors of HR 5823 to date are Rep. Joe Baca, D-San Bernadino; Rep. Judy Chu, D-Los Angeles; Rep. Susan Davis, D-San Diego; Rep. Dana Rohrabacher, R-Huntington Beach, and Rep. Brad Sherman, D-Sherman Oaks.
NAR, which has raised dues for its nearly 1 million members by $40-a-year dues in order to raise $80 million in "soft money" for political advocacy at the local, state and federal level this year and next, held a "Rally to Protect the American Dream" in Washington, D.C. Thursday that attracted an estimated 15,000 Realtors.