A dicey start to the spring housing season has raised the prospect that the government will remain dominant in the mortgage market for longer than intended, the Wall Street Journal reported. The fragility of the market, falling prices and reduced consumer confidence are making it difficult for Washington to pull back its support.

Government-sponsored organizations Fannie Mae and Freddie Mac must try to return to sound lending standards without cutting off access to mortgages completely, according to the Journal. Taxpayers are on the hook for $138 billion since Washington took over control of the organizations in 2008, a loss that it cannot walk away from.

“We’re not going to get a recovery in housing until the average borrower can get a mortgage,” said Kenneth Rosen, a California-based economist. [more]

Miami real estate veteran Kenneth Rosen has invested here for 40
years. While he always had a formula for his acquisitions, he hadn’t
committed it to paper until recently. His “Big Six” principles include
seeking top locations, quality building design in class-B buildings and
high occupancy rates in the property you buy. Properties need
recognizable upside potential, should be financed creatively with local
lenders, and, of course, change hands at a reasonable price. [more]

A recent study predicts that up to 20 percent of all loans to U.S.
hotels will default by the end of 2010. The recession has caused such
severe cutbacks in travel and spending that hotels won’t be able to
service their debts, University of California economist Kenneth Rosen
said. Hotel foreclosures almost doubled in the second quarter of the
year from the first three months of 2009. Defaults and foreclosures hit
$17.3 billion in the second quarter, up from $9 billion at the end of
the first quarter, according to Real Capital Analytics. [more]