Housing Finance Reform Incubator
With this incubator, the Urban Institute’s Housing Finance Policy Center hopes to nurture a fresh, open-minded look at the future of the housing finance system.
On this page, you will find short essays about the future of housing finance reform from authors who hold a wide spectrum of views. By inviting thoughtful people outside the Housing Finance Policy Center to join us in open-minded rethinking, we embrace the importance of open dialogue, listening to each other, and the opportunity to learn from others’ experiences.
These essays address the future housing finance system postconservatorship and explain how the authors think we could get there. The authors also address how the system they envision will serve underserved communities and households.
When the series concludes, the essays and concluding remarks will be compiled in a single document.
By bringing thoughtful voices together in a single forum, we hope to expand the debate and pave the way for new ideas. We look forward to a compelling and game-changing discussion.
To stay abreast of this conversation, you can check this page each week. You can also follow @MortgageLaurie on Twitter or sign up here to get our bimonthly newsletter with links to all upcoming work.
Laurie Goodman: A New Forum for Fresh Thinking on Housing Finance Reform
"It is time for an open-minded look at the housing finance system and what role, if any, today’s government-sponsored enterprises might play in the future."
Tim Howard: Fixing What Works
"When invented narrative is replaced with verifiable fact, Fannie and Freddie cease to be a 'failed business model' that must be wound down and replaced; they instead become valuable resources that must be built upon and improved."
Jim Millstein: An Administrative Plan to Restructure and Reform the GSEs
"To address the conflict between their affordability mission and shareholder returns, the mortgage guaranty businesses should be subjected to utility-like regulation, with strict activity, leverage, and return on equity limitations."
Alex J. Pollock: Seven Steps to Housing Finance Reform
"At the 10% Moment, Congress should declare the senior preferred stock fully retired, as in financial substance it will have been. Simultaneously, Congress should formally designate Fannie and Freddie as systematically important financial institutions."
Mark Zandi: A More Promising Road to Reform
"A group of us has put forward a reform proposal that addresses the system's structural problems and keeps what works."
James H. Carr: America Needs a 21st-Century Housing Finance System
"The basic pillars of America’s housing finance system were enacted 80 years ago. Since then, major reconfigurations in our economy, demographic composition, and household locational preferences demand a bolder vision for housing finance in the 21st century."
Andrew Davidson: Four Steps Forward: Streamline, Share Risk, Wrap, and Mutualize
"A realistic approach to GSE reform is to strip the GSEs down to the functions that promote standardization, liquidity, and access to credit, and adopt the best governance structures for those functions. This can be achieved in four steps: streamline, share risk, wrap, and mutualize."
Mark Calabria: Coming Full Circle on Mortgage Finance
“Mortgages, under any system, have to rest on someone’s balance sheet. Like water running downhill, the risk has flowed to the most leveraged sectors of our financial system. This is a recipe for instability.”
Patricia Mosser: Principles–and a solution–for GSE reform
“The characteristics of mutuals that may be seen as disadvantages for some types of financial companies are in fact advantages for our financial market utility proposal because they align the utility’s incentives with other actors in the securitization chain.”
Marc Morial: The Homebuyers' Bill of Rights 2.0
“In the aftermath of the Great Recession, the tragic loss of wealth, and the bailout of the big banks, our national government must continue to play a central role in the housing market to right previous wrongs, ensure access to all qualified borrowers, and keep the housing finance system afloat for future generations.”
Laurie Goodman: How Can We Keep Rent within Reach for Families?
"Between now and 2030, this country will face an unprecedented surge in rental housing demand. Already, rents are skyrocketing out of the reach for many families, especially in places with job opportunities. New multifamily housing construction is at its highest level since the 1986 Tax Reform Act, but most of the units are high end, which limits affordability."
Gary Acosta, Jim Park, and Joe Murin: The Future of the GSEs? The "Ginnie Mae 2.0" Solution
"There will be nuanced demands coming from the high concentration of household formation in African American, Asian, and Hispanic communities. Ginnie Mae 2.0 looks to be the safest way to build a sustainable platform to bring proven market stability to meet the needs of a materially changing demographic."
Ethan Handelman and Shekar Narasimhan: Do No Harm: GSE Multifamily Works
“The most critical need for multifamily is simply that policymakers pay attention to it early and plan ahead.”
Michael D. Berman and Mark A. Willis: Multifamily GSE Reform: A Different Road
We propose a spinoff of the multifamily business units of the GSEs and the formation of other new guarantors to increase access to affordable multifamily financing.
Doug Bibby and Bob DeWitt: Rebuilding Housing Finance on a Strong Foundation
"Consensus exists that a reformed housing finance system must protect taxpayers, emphasize the private markets, support a broad variety of housing options and remain liquid throughout an economic cycle. Surprisingly, few recognize that a proven model already exists that meets those objectives-and it's the multifamily programs of Fannie and Freddie."
Barry Zigas: Achieving Access and Affordability in Mortgage Finance
"Mortgage finance reform discussions have failed to generate consensus assuring the widest possible access to sustainable mortgage credit at the lowest practical cost. We can resolve this impasse if we integrate all federal supports for mortgage finance into one cohesive whole."
Edward J. Pinto: It's Time to Put the Market Back in Housing Finance
"Today’s government-centric housing finance system is an “economics free zone” indifferent to supply and demand. Composed of an alphabet soup of agencies, this system has fostered a massive liberalization of mortgage terms and provided countless trillions of dollars in lending. Yet housing has become less, not more affordable or accessible."
John Taylor: Improving Our Mortgage Finance System Shouldn’t Require a Total Reinvention
"Much of the conversation on Capitol Hill and among policy thinkers has pushed affordability and access to the back burner. We need to bring it to the forefront of the conversation. The shape and quality of housing finance reform will have repercussions in every neighborhood and community and for our national economy."
Mike Calhoun and Sarah Wolff: Who Will Receive Home Loans, and How Much Will They Pay?
"Average price estimates obscure significant variation. To assess access and affordability, we need to look closely at differential prices, not just overall prices or prices for low–credit risk profiles."
Rodrigo Lopez and Debra Still: Affordable Housing and Access to Credit: Critical Objectives for a New Secondary Mortgage Market
"We believe that all housing needs, from the most directly-subsidized, affordable rental housing to the prime jumbo single-family lending market, lie along a single continuum. This housing continuum can be best served only by addressing single-family and multifamily, rental and homeownership, government and private capital, as parts of a holistic strategy."
Janet Murguía: Updating Our Housing Finance System to Reflect a Changing America
"By 2020 half of all first-time homebuyers will be Latino. Without affordable access to credit for these prospective buyers, the housing market will decline, with harmful consequences on the larger economy."
Jim Parrott: Clarifying the Choices in Housing Finance Reform
"Coming out of the crisis, there was thus almost universal agreement that we should reduce our reliance on this duopoly and shift more risk into a competitive private market."