Fox News host Sean Hannity has been aggressively speaking out after a report this month that he bought foreclosed and under market value homes as investment tools through various shell companies. This went on while he was getting support from the Department of Housing and Urban Development. The argument from his political enemies seems to be that Hannity should have disclosed the investments because he is a ‘journalist.’ Hannity counters that he is a commentator and he is not required to disclosed personal investments.
In a statement he released this week, he noted it is ironic that he is being attacked for investing his money into communities that need investment. He added that he doubted the people attacking him had invested any of their money in those communities. Hannity also said that the properties he purchased were made on his behalf and he did not know the exact details of what was purchased.
Hannity also said that he never talked with anyone at HUD about the loans that he got during the Obama administration and he also did not talk to them about refinancing the loans. Hannity stressed the loans on these investments are a private matter.
Reports state that the Fox News host bought more than 870 homes in seven states over the last 10 years, with values over $90 million. The loans from HUD were done through the National Housing Act. The Act offers investors protection against the loans defaulting when they are buying rental homes. There were bigger loan guarantees given to rental property buyers who were offering housing to lower income renters.
His political enemies in the media note that after Ben Carson took over as HUD secretary, Hannity’s loan portfolio increased by $5 million. Hannity said in his response this week that he never talked about the loans with HUD at any time and he also did not disclose them to his viewers when he interviewed Carson on his show in 2017.
Journalists generally are expected to recuse themselves from reporting on a subject where they have a personal connection or at least disclose the connections. Hannity maintains that he is not a journalist.
While he was buying these discounted homes, Hannity criticized the Obama administration for the struggles that some Americans have in buying their own homes during the housing down turn. Apparently, the argument is that Hannity should not have been investing in rental properties while arguing that Americans were having trouble buying a home.
But the counterargument is that Hannity was investing in rental properties in communities that need them. There is a shortage of good, affordable rental properties in many cities across America. When there is more rental property available, the rents often decrease. Also, rising home prices and interest rates are preventing some people from being able to buy a home currently. Those people need to continue to rent, and Hannity was simply providing a needed product to the marketplace.
There also is nothing illegal about using mortgages funded through HUD to purchase rental property portfolios. The argument seems to be that a wealthy person should not be using government funded mortgages to buy property. In most instances, when a borrower takes out a government mortgage, they are paying monthly mortgage insurance. It’s no secret that FHA loans require that borrowers pay mortgage insurance every month, so unless Hannity is not making his payments, he is doing nothing wrong.
The bottom line is that Hannity has been investing his money in areas that many of his critics are not. It is essentially a baseless political attack attempting to bring down one of the most popular conservative TV and radio hosts in the country.
References: https://www.huffingtonpost.com/entry/sean-hannity-defends-real-estate-portfolio_us_5addf7a7e4b0df502a4e0b52 and photo credit to The Daily Beast