The July edition of At A Glance, HFPC’s reference guide for mortgage and housing market data, includes updated indicators related to credit availability, the state of the GSE portfolios, and the latest mortgage origination and housing market projections.
Veterans Administration (VA) loans have consistently performed better than Federal Housing Administration (FHA) loans. In this commentary, we take a closer look at both programs to identify why VA loans perform better. We conclude that the residual income test may be a critical differentiating factor and suggest that regulators evaluate whether the test might be a good supplement to FHA’s current assessment of a borrower’s ability to pay.
This study examines critical gaps in affordable housing across a range of income levels in the Washington, DC region. More permanent supportive housing is needed to reduce chronic homelessness. The lack of affordable apartments, particularly for extremely low income renters, contributed to the number of homeless people and resulted in over half of all renters paying over 30 percent of their income on housing costs. Low income homebuyers also faced challenges because of high prices. These findings can help local governments and philanthropy direct scarce public and private resources to address the region's affordable housing needs.
Laurie Goodman, Ellen Seidman and Jim Parrott discuss the consensus that emerged around reform of the Government-Sponsored Enterprises, the fault lines in the Senate negotiations, where reform stands now, and the likelihood and consequences of further action or inaction in the coming months.
The June edition of At A Glance, the Housing Finance Policy Center’s reference guide for mortgage and housing market data, includes updated indicators related to credit availability, the state of the GSE portfolios, and the latest mortgage origination and housing market projections.
The FHA has been taking actions to reduce lender overlays, enhancing access to credit. Among these measures is the introduction of Supplemental Performance Metrics, to accompany the inflexible Lender Compare Ratios. In this article we reiterate the need for this type of metric, applaud the FHA for proposing it, and suggest a slight variation to make it even more effective.
Urban Institute fellow Jim Parrott and guest Jim Millstein discuss the prospect of long-term administrative reform of Fannie Mae and Freddie Mac. The discussion begins with Parrott's commentary, "Why Long-Term GSE Reform Requires Congress" and continues with Millstein's blog post, "It's time for administrative reform to end the GSE conservatorships."
During negotiations over the bill to reform the Government Sponsored Enterprises (GSEs) that was recently passed out of the Senate Banking Committee, some stakeholders and policymakers argued that the better course was to pursue long term GSE reform administratively. In this commentary, Jim Parrott explains why that can’t be done. Leaving the enterprises in conservatorship permanently is unhealthy for the market and unduly risky for both the enterprises and the taxpayer. Yet bringing them out of conservatorship would be cataclysmic for the enterprises and market alike. The only path available on long term reform thus leads through the halls of Congress.
At A Glance, the Housing Finance Policy Center's monthly chartbook, provides timely metrics on the state of the housing market and examines public policy's role in housing finance. May’s issue includes updated measures of new securities issuance, GSE guaranty fees, and mortgage insurance activity.