In an op-ed written for the Washington Post, former treasury secretary Hank Paulson says government policies promoting homeownership fueled the housing crisis and, once the market has stabilized, should be dramatically reformed. Specifically, he recommends scaling back both Fannie Mae and Freddie Mac and reducing subsidies for homeownership. Limiting the availability of subsidies to smaller mortgages or lower-income buyers would reduce the scope of the government's role and lead to less risk to taxpayers and the economy. Former Federal Reserve Chairman Paul Volcker also weighed in on the debate in an article from SmartMoney magazine. Volcker says Fannie Mae and Freddie Mac are unnecessary and should be eliminated because of the inherent conflict between their responsibilities to the government and their stockholders. He believes the entire mortgage market has to be reconstructed in the coming years. More here and here.
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Daytona Condo Realty, 386-405-4408 - Daytona Beach, FL
Buy Daytona condos for heavenly good prices
Michael,
After readin git I am tempted to think that the more government, the less housing. Am I wrong?
Aug 02, 2010 01:05 PM
Guaranteed Rate, Inc - Charlotte, NC
The Michael Pond Team
Yes and no Jon. In my opinion, Fannie Mae and Freddie Mac have been the stablizing force in the market standardizing the industry. That is the main factor that has allowed the industry to grow and make homeownership more affordable for the average American. In this case, government standardization is GOOD.
Over regulation and the high cost of them is making government bigger and adding hurdles for the average homeowner. The last report I've read stated that the average cost has gone up $850 per mortgage due to the new regulations.
I am ALL for accountablity, responsible lending and making homeownership affordable for the average American. Big government can help and hurt. The Financial Reform Act was only the beginning. There is a movement in Congress to toss the baby along with the bath water. SCARY TIMES AHEAD OF US!
Aug 02, 2010 01:22 PM
HomeSmart Realty West - San Diego, CA
Realtor & CDPE, Mission Valley specialist
Personally, I think everyone, no exceptions, should be required to put at least 10% down on a home, and that 10% should always remain. Actually owning a home, or at least 10% of it, creates a better incentive to keep it, maintain it, etc.
Aug 22, 2010 08:46 AM
Margaret Rudd & Associates Inc. - Oak Island, NC
Crye-Leike Realtors® - Rogers, AR
Crye-Leike Realtors®
Good Morning Michael, thanks for the post. The less government the better. I hope you come back and post some more in the Rain.
Oct 11, 2011 01:21 AM
Guaranteed Rate, Inc - Charlotte, NC
The Michael Pond Team
Thanks Phil, I appreciate the comment....I do need to get back to blogging!
Oct 12, 2011 04:28 PM
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