White House Releases Agency Road Map for Housing Reform
Earlier this year, President Trump issued a memorandum directing the U.S. Dept. of Treasury and the U.S. Dept. of Housing and Urban Development (HUD) to craft housing finance reform plans. This week, the White House released housing finance reforms plans for Treasury and the HUD. The agencies’ plans include recommendations for both legislative and administrative reforms. Among the recommendations, the most notable is to end the conservatorship for the two government-sponsored entities (GSEs), Fannie Mae and Freddie Mac. The agencies’ plans also address overhauling the Federal Housing Administration (FHA), in addition the GSEs.
The Treasury Department report makes 49 legislative and administrative recommendations, including:
- having both GSEs recapitalized so that private capital can take a first-loss position on the GSEs’ exposure to risk and loss;
- replacing the GSEs’ statutory affordable housing goals with an alternative approach to deliver support to first-time homebuyers, low-and moderate income rural and other historically underserved borrowers; and
- revising the GSEs’ underwriting criteria for multifamily loans in jurisdictions with rent-control laws or other impediments to housing development.
Similarly, HUD’s report makes 67 legislative and administrative recommendations, including:
- a complete restructure of FHA to an autonomous corporation within HUD;
- separating the mortgage insurance side of the FHA from the rental subsidy by establishing a new Office of Rental Subsidy and Asset Oversight within HUD; and
- ending the unit cap on the Rental Assistance Demonstration program.
Next week, the Senate Committee on Banking, Housing and Urban Affairs will hold a hearing, titled “Housing Finance Reform: Next Steps.” The hearing is scheduled for Tuesday, Sept.10, at 10 a.m. EST. It will feature three witnesses: Treasury Secretary Steven Mnuchin, HUD Secretary Ben Carson and FHFA Director Mark Calabria.
Disaster Resources
Our thoughts and prayers are with members impacted by Hurricane Dorian. Please let NAHMA know if we can be of any assistance. Please find information on HUD’s disaster resources for impacted regions here. Members can also find agency disaster updates on NAHMA Disaster Recovery webpage here.