There is a “war on housing” brewing in Washington. Homeownership seems to be under attack. As 2010 NAR First Vice President Moe Veissi pointed out in his recent blog, ill-informed views on homeownership are appearing more and more in the media.
Last week, industry leaders, executives and policy makers gathered in Washington, D.C., for a housing conference sponsored by the Treasury to discuss the future of the housing finance system and the fate of Government Sponsored Enterprises (GSE’s) Fannie Mae and Freddie Mac.
The conference featured panels moderated by Treasury Secretary Timothy Geithner and HUD Secretary Shaun Donovan, as well as breakout sessions that focused on topics from the “Role of the Private Sector and the Government in a Reformed Housing Finance System” to “Managing the Process of Transition to a New Financial System”.
I was assigned to participate in the breakout session entitled, “Aligning Private Market Incentives in the Housing Finance Chain”, moderated by FHA Commissioner Dave Stevens. In recent weeks, long-term fixed rate mortgages have come under increasing pressure from pundits who believe this product is partly the crux of the nation’s housing finance problem.
During the session, I had the opportunity to briefly share NAR’s views regarding the importance of maintaining the 30-year fixed rate mortgage, which is an extremely safe mortgage product.
While some at the conference, advocated the need to support a mortgage market for all types of housing, in all market conditions, other speakers questioned the level of government support for the housing industry.
What did they say?
They asserted that taxpayer money is better spent on other industries with the greater promise of job growth and productivity for our economy.
The debate we’re starting to see over the government’s role in housing touches on many issues: over-housed citizens, the deficit, tax incentives (MID and capital gains) the GSE’s, and other public incentives.
Homeownership is not for everyone, surely. But if you are prepared for its responsibilities, it’s an excellent way to invest your money and receive financial and social benefits in return.
At the conference, Secretary Geithner stated that: “Fixing our housing finance system is one of the most consequential and complicated economic policy problems we face as a country”.
REALTORS® know this to be absolutely true. We recognized this early on. In late 2008 we started formulating a reformation plan for the GSE’s.
While there is no clear consensus in Washington as to what needs to be done to fix Fannie Mae and Freddie Mac, participants at the conference generally advocated a need for some level of government support for the housing finance sector for the foreseeable future.
So as the Administration focuses its attention on the future of housing finance and the GSE’s, NAR—together with your support—will continue to espouse the virtues of homeownership and of providing a mechanism to ensure that qualified buyers have access to the capital they need to become homeowners. This is how we will respond to the “war on housing.”
While we face one of our greatest industry challenges, it does provide us with a tremendous opportunity to energize and engage homeowners and prospective homeowners in this housing debate. Vince Malta, 2010 Vice President and Liaison to Government Affairs