What IS clear is that the Obama administration is taking action to help the housing industry.

What isn’t clear is if anything can be done to help the housing markets other than allowing the home prices to correct on their own. In other words, let Realtors get the homes sold and stop messing with the markets!

Many are questioning if the numerous housing programs are doing anything other than ‘kicking the can down the road’…

…..with perhaps one exception…..The first time home buyer credit. There is NO question that this limited time program DID work…..so, will the program be extended. Will qualifying buyers still receive a $8,000 tax credit?

There is strong industry support for the continuation (if not expansion) of the program. Makes sense that those of us in the housing industry would support the continuation of a program that helps folks buy and sell homes….and Realtors earn a living.

But, there are growing reasons to believe that the program won’t be continued….and…the Obama administration is about to focus on the lower income rental markets…and giving states money to aid home buyers directly.

Here is a article from WSJ.com that explains how the Obama administration is pumping money into the HSA’s. HSA’s are local housing authorities that supply money to low income families.

So, the question is…will well funded HSA’s replace the tax credit? Should we expect the ‘First Time Buyer Tax Credit’ to go the same way the ‘cash for clunkers’ program….extinction?

The Obama administration is launching a new effort to prop up the housing market by restoring financing to state and local housing agencies.

Such agencies, known as HSAs, help low- and moderate-income families purchase homes or attain affordable rental housing. They have come under strain amid the financial crisis as investors have shunned their debt, forcing the agencies to curtail their activities.

The administration on Monday announced that Treasury would begin purchasing securities from Fannie Mae and Freddie Mac backed by new housing bonds issued by the HSAs to fund their activities. In addition, Fannie and Freddie will launch temporary credit and liquidity facilities for the HSAs. The state agencies will pay a fee for access to both programs.

“This initiative is crucial to helping working families maintain access to affordable rental housing and homeownership in tough economic times,” Treasury Secretary Timothy Geithner said in a press release, issued jointly by the Treasury, the Department of Housing and Urban Development and the regulator for Fannie and Freddie.

The new initiative comes “at little or no cost to the taxpayer,” according to the release, because it relies on fees from the state housing authorities and is designed to be temporary. The two programs will be available for “only a short window” to help the HSAs through the rough period in the credit markets, the administration said.

The bond program will support several hundred thousand new mortgages to first-time home buyers next year and enable strapped borrowers the chance to refinance into more affordable mortgages, according to an administration fact sheet. It will also fuel the development of tens of thousands of new, affordable rental-housing units.

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