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What We're Reading: February 29

Throughout the week, the BPC Housing Commission highlights news items that address critical developments in housing policy. Any views expressed in the content posted on this forum do not necessarily represent the views of the Commission, its co-chairs or the Bipartisan Policy Center.


Housing prices fell in December, continue to hurt economic recovery

By Michael A. Fletcher

The Washington Post

“The nation’s home prices have fallen to their lowest level since 2002, according to a private report, casting a troubling shadow over what has otherwise been a brightening economic recovery.”

Read more here.


Fannie Mae asks Uncle Sam for $4.6 billion more

MSNBC

“The mortgage giant reported a net loss of $2.4 billion in the fourth quarter of 2011 after it got slammed by falling home prices. To offset the deficit that helped cause, its regulator, the Federal Housing Finance Agency, plans to submit a request to the Treasury for $4.571 billion…”

Read more here.


Bank of America Breaks With Fannie Mae

By Nelson D. Schwartz

The New York Times

“Bank of America insisted its customers would not be hurt by the decision, and said it can make up for the loss of Fannie as a backer by turning to Freddie Mac or Ginnie Mae, other government-sponsored mortgage buyers; the private sector; and by deploying its huge balance sheet.”

Read more here.


Plotting the Future of Fannie and Freddie

By Christopher Matthews

TIME

“In 2008, at the height of the financial crisis, Congress and the Bush administration created the Federal Housing Finance Agency (FHFA) and subsequently put Fannie and Freddie into conservatorship under its authority. Three years later, the federal government has pored $180 billion into the two entities with no clear exit strategy.”

Read more here.


Why the Federal Reserve can’t fix housing

By Annalyn Censky

CNNMoney

“Housing is still one of the biggest drags on U.S. economic growth, but don’t look to the Federal Reserve for help. The central bank may have few tools left to fix it.”

Read more here.


Fannie Mae Begins Marketing Foreclosed Homes as Rentals

By Alan Zibel and Nick Timiraos

The Wall Street Journal

“Fannie Mae plans to sell nearly 2,500 foreclosed properties to investors in the first phase of an initiative to aid the U.S. housing market through bulk sales of distressed homes.”

Read more here.


Can we fix housing by turning foreclosures into rentals?

By Suzy Khimm

The Washington Post

“To some observers’ surprise, about 85 percent of the properties are already occupied by renters, contrary to their expectations that the program would mostly target vacant, foreclosed homes.”

Read more here.


Ranieri: The Case for Converting Foreclosures to Rentals

By Nick Timiraos

The Wall Street Journal

“Lewis Ranieri, the co-inventor of the mortgage-backed security, authored a research paper with University of California economist Kenneth Rosen that lays out the case for using federal entities to support private investors who are already converting foreclosed properties into rentals.”

Read more here.


Obama’s HARP 2.0 hasn’t achieved lift-off yet

By Suzy Khimm

The Washington Post

“Between its inception in April 2009 and the third quarter of 2011, HARP has provided about… 29,000 per month. Under HARP 2.0, which began to take effect in late December, the rate of new loans has been about 25,000 loans per month, based on Donovan’s numbers.”

Read more here.


‘Failed’ Housing Programs: How Rental Market Will Benefit?

By Susanna Kim ABC News

“Federal efforts to help struggling homeowners are not working, and instead it’s the owners of rental properties who are benefiting, said Gary Shilling, one of the economists who predicted the subprime mortgage crisis.”

Read more here.


Banks Win Reprieve on Home Equity Loans in Settlement: Mortgages

Bloomberg Businessweek

“Bank of America Corp., Wells Fargo & Co. and three other banks that settled a nationwide probe of foreclosure practices this month will get a bonus from the deal: protection for $308 billion of home-equity loans they hold.”

Read more here.


Proposed bill would allow principal write-downs in bankruptcy courts

By Kerri Panchuk

HousingWire

“Rep. Earl Blumenauer, D-Ore., proposed The Bankruptcy Equity Act to amend bankruptcy laws to allow judges to modify mortgages on principal residences of debtors to prevent foreclosure and cure distressed situations.”

Read more here.


The End of Ownership: Why Aren’t Young People Buying More Houses?

By Derek Thompson

The Atlantic

“Between 1980 and 2000, the share of late-twenty-somethings owning homes had declined from 43% to 38%. The share of early-thirty-something home owners slipped from 61% to 55% in that time.”

Read more here.

“It’s no wonder that in an environment that punishes the long-term faithful, more young people are planning month to month.”


In a depressed housing market, renters abound

By Motoko Rich

The Boston Globe

“With few rental buildings erected over the past few years, available units are going fast. Nationwide, the apartment vacancy rate is down to 5.2 percent, its lowest level in more than a decade.”

Read more here.


How More Expensive Housing Can Actually Cost You Less

By Emily Badger and Kaid Benfield

The Atlantic

“The farther you go in search of cheaper housing, the more expensive your transportation costs become.”

Read more here.


More U.S. kids living in high-poverty areas: study

By Susan Heavey Reuters

“Years of economic setbacks have taken their toll on the nation’s youngest residents, with another 1.6 million children living in high-poverty neighborhoods…”

Read more here.


The U.S. Metro Areas That Attract the Most Seniors

By John K. McIlwain

The Atlantic

“The growth of America’s senior population is accelerating rapidly… During the current decade, the population is projected to grow is a stunning 55 percent, adding another 60 million seniors.” Read more here.


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