The regulator for housing finance firms Fannie Mae and Freddie Mac said on Wednesday investors could now sign up to pre-qualify to bid on foreclosed properties held by the government-controlled firms.

In a plan to help the struggling U.S. housing market by clearing a backlog of foreclosed properties, investors could purchase homes to convert them into rental units under the program.

The Federal Housing Finance Agency said it will announce the first transaction during a pilot phase of the so-called REO initiative in the near term.

(Reporting by Jason Lange and Margaret Chadbourn)