Own to Rent: Yes We Can!

[katty]

Own to Rent: Yes We Can!

(Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR). He is the author of The Conservative Nanny State: How the Wealthy Use the Government to Stay Rich and Get Richer (www.conservativenannystate.org). He also has a blog, "Beat the Press," where he discusses the media's coverage of economic issues. You can find it at the American Prospect's web site.
By Dean Baker
t r u t h o u t | Perspective

Monday 11 February 2008

more: http://www.truthout.org/docs_2006/021108G.shtml

excerpt:
This is what a recession looks like, and there is probably nothing that can be done at this point to prevent a recession, although an aggressive stimulus package can help to ameliorate the effects of the downturn. The measure going through Congress is a positive step, even if it is inadequate for the size of the downturn facing the economy.

While we can't prevent the recession, we can try to do something about the millions of people who face the loss of their home. The latest data show houses are now being foreclosed at a rate of almost 170,000 homes a month, a record high.

The government can't shield every homeowner from the collapse in house prices, but it can help out the most vulnerable among this group. The simplest way to help moderate-income homeowners facing foreclosure is to adopt an "own to rent" policy under which the rules on foreclosure would be temporarily changed to allow moderate-income homeowners the option to remain in their home as renters.

Under this own to rent plan, the judge handling a foreclosure would call in an independent appraiser, who would determine the rental value of a house in the same way an appraiser determines the sale value of a house before a bank issues a mortgage. The homeowner would then have the option to remain in the house as a tenant, paying the rent determined by the appraiser.