Both Fannie Mae and Freddie Mac imposed a reduction in the amount of properties and their rationale was was their belief that investors who own higher numbers of rental condos and houses pose a greater risk of default, foreclosure and loss for the companies. In fact the restriction effectively shut out many small investors from Fannie's and Freddie's standard programs -- and pushed them into much higher-cost financing from so-called "hard money" lenders.

Highly qualified real estate investors play a big role in the economy of this country. The lending environment for investors is so hostile now, they are preventing good deals from responsible investors from happening. That is not helping the housing market.