by Calculated Risk on 3/05/2012 09:03:00 AM

From Bloomberg: Boom-Era Property Speculators to Get Foreclosure Aid (ht Mike in Long Island)

The Obama administration will extend mortgage assistance for the first time to investors who bought multiple homes before the market imploded, helping some speculators who drove up prices and inflated the housing bubble.

Landlords can qualify for up to four federally-subsidized loan workouts starting around May, as long as they rent out each house or have plans to fill them, under the revamped Home Affordable Modification Program, also known as HAMP, according to Timothy Massad, the Treasury’s assistant secretary for financial stability.

But this example doesn't seem to make sense:

John Russell, 61, of Northville, Michigan, said he was never a speculator seeking to flip houses. He bought four rental properties in neighborhoods in the state more than 10 years ago and said he planned to keep them for decades more. Now the houses are worth far less than he owes, his rents have tumbled, and he has to spend about $20,000 a year to keep them operating.

Russell ... said two houses are in foreclosure and he can’t afford to keep them without the federal government’s help.

How can this be? I'd like to know more. I wonder how far rents have fallen in "over 10 years", and if Russell took out money during the housing boom. This doesn't appear to add up ...