Jon Prior, Housing Wire

Only half of the previously foreclosed homes owned by Fannie Mae are either on the market or being prepared for sale. The remaining properties are currently locked away in some step of the foreclosure system.

The National Association of Realtors said in its existing home sales report Wednesday that its officials were pressuring government agencies to release more of their REO in markets short of inventory.

Many market participants long claimed the government – including Fannie, Freddie Mac and the Department of Housing and Urban Development – are deliberately holding these homes off the market in order to get more for them when home prices recover.

Fannie disclosed for the first time this year where these properties are in the lengthy and complicated REO process. In its second quarter financial filing, the government-sponsored enterprise said 23% of its more than 109,000 repossessed homes are currently available for sale.

That’s down from 28% at the end of last year.

An offer has been accepted on another 19%, and 11% have an appraisal pending, Fannie said.

But 47% of its inventory is unable to be marketed.

Roughly 14% of Fannie’s entire REO inventory is redemption status, meaning the time frame borrowers and second-lien holders can redeem the property under various state laws. The timelines vary and have come under much change across the country. In Michigan, for example, lawmakers passed a bill last year to extend the redemption period to as much as one year in some cases. The bill was referred back to a state committee in March.

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