The National Association of REALTORS® hosted a policy forum March 16 titled, “The Current Housing Market: Implications for Home Buyers and the Economy,” at the Capital Hilton in Washington, D.C.
The opening session, Promoting Homeownership, Affordable Rentals, and Investor Involvement All at Once, featured a keynote fireside chat with the Director of Federal Housing Finance Agency (FHFA), Sandra Thompson, moderated by NAR’s VP of Policy Advocacy, Bryan Greene.
“Let’s make sure there is liquidity at all times, all places, not just some places. And make sure people have safe, decent, and ever-elusive affordable housing, and do it in a sustainable way,” Thompson said. “Sustainability means people can stay in their homes. That is really important to me.”
Thompson endorsed borrower education and financial assistance to keep people in their homes when the unexpected happens. “There can be issues like a broken hot water heater, things that come up that impact a person’s balance sheet. Maybe there should be a reserve or contingency account to ensure sustainable homeownership.”
During a conversation on the affordability crisis, Thompson emphasized a duty-to-serve requirement for Government Sponsored Enterprises for rural, affordable housing preservation. She talked about the recent success in alternative credit scoring, like the inclusivity of positive rental payments, monthly subscriptions, and utilities in credit scoring. “Those credits are being incorporated into scoring decisions of these borrowers. We have been able to positively score tens of thousands of borrowers,” she said to rapturous applause.
Thompson touched on appraisals, which FHFA has put out data on that allows people to analyze appraisals by census track. “We really try to have data-driven, fact-based policies. And look at how to better serve underserved communities,” she said. “We are very much focused on the appraisal issue; people were so focused on over-evaluations, and hardly anyone focused on under-evaluations.”
Greene asked Thompson about the future of Home Loan Banks, a subject which NAR has engaged with FHFA. “Today, the Home Loan Banks are really fulfilling their mission to provide liquidity, promote affordability, and community development,” Thompson said. “The Home Loan Banks have been instrumental in providing liquidity when it is most needed, during a crisis, during the pandemic and the great recession in 2008. Can they do better? Absolutely. There are ways to improve, but they are doing what they are supposed to be doing.”
Thompson’s final thoughts during the discussion emphasized FHFA’s commitment to expanding affordable housing. “All housing legislation deserves bipartisan support…and for it to focus on the needs and futures of so many people across the country.”
Additional discussions
Senator Catherine Cortez Masto (D-NV) joined the Forum to outline legislative solutions currently being considered in Congress to bolster the housing market. She also discussed turning advocacy into action, a message that strongly resonated with attendees in the room.
Donna Leinwand Leger, president and founder of DC Media Strategies LLC and senior advisor to Stanton Communication, moderated conversations with Scott Brown, former U.S. Senator and Ambassador to New Zealand and Samoa, and Kevin Hassett, former chairman of the President’s Council of Economic Advisers, on current economic conditions and their impacts on the housing industry, legislative solutions, and ways to bring people together on solving the housing supply crisis.
“Housing and veteran issues are where Democrats and Republicans should come together; they are no-brainers,” said Brown. “Everyone wants a safe home, in a safe community, in a good school district…these are all things that members of Congress should be able to agree on.”
As a landlord himself, Brown went on to discuss the need to “give some teeth to local housing authorities” to fix the bigger issues and obstacles landlords face, such as voucher programs. “Protect not just the tenant, but the mom-and-pop landlords too.”
Hassett spoke about the overall health of the economy and said the rent increases and high home prices we see now are “a direct result of a supply problem. The housing crisis in the middle of the country where rent is outpacing income–nearly half of all Americans are spending 30% on housing. The policy challenge for Democrats and Republicans is to think of ways to accelerate supply. There is a record of bipartisanship on this topic…such as opportunity zones.”
Callum Williams, senior economics writer for The Economist, then moderated two lively afternoon discussions on affordability and the market impact of institutional investors.
In the first panel, Nate Schultz, chief of staff of the Office of Housing and the Federal Housing for HUD, Mark McArdle, assistant director, Mortgage Market for the Consumer Financial Protection Bureau, and Mark Calabria, senior advisor to the Cato Institute and former director of the Federal Housing Finance Agency, had a wide-ranging conversation on how COVID affected mortgage loans, the recent bank collapse, housing supply, and climate risk.
In the second panel, Genger Charles, managing director and head of External Affairs and Impact Strategies, Kenneth Chilton, Ph.D. associate professor at Tennessee State University, and Noerena Limon, principal at Mariposa Strategies LLC, discussed the impact of institutional investors on America’s housing market. The panelists’ dissenting views demonstrated the complexities of this issue and the need for further study and discussion in coming years.
To read the full report, visit https://www.nar.realtor/events/policy-forum.
