Housing Policy: Are We Serving the Underserved

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A Sunset Seminar with CoreLogic and the Urban Institute

This July, CoreLogic partnered with the Urban Institute to co-host a seminar highlighting the challenges, opportunities, and expectations of the Government Sponsored Enterprises’ (GSEs) Duty to Serve Plans.  The event was the 12th in the Sunset Seminar series, sponsored by CoreLogic and the Urban Institute and focused on public policy thought leadership relevant to the mortgage market.  The series brings together policymakers, practitioners and analysts for lively, data-driven discussions on topics of current importance.  A summary of the event is available online, as well as a copy of the event agenda, speaker biographies and Sam Khater’s presentation.

The panel was held at the Urban Institute’s offices in downtown Washington, D.C. and moderated by Alanna McCargo, co-director of the Housing Policy Finance Center at the Urban Institute, and it included the following housing industry experts (Figure 1 photo):

  • Ethan Handelman, Vice President for Policy and Advocacy, National Housing Conference
  • Sam Khater, Executive, Research and Insights, Deputy Chief Economist, CoreLogic
  • Ann Kossachev, Regulatory Affairs Counsel, National Association of Federally-Insured Credit Unions
  • Doug Ryan, Director of Affordable Homeownership, Prosperity Now
  • Corianne Scally, Senior Research Associate, Metropolitan Housing and Communities Policy Center, Urban Institute

Sam opened with a CoreLogic data assessment of the progress that has been made in recent years to achieve the Low-Income Purchase Goal set forth by the Federal Housing Finance Agency (FHFA).  He identified several problems in the available market data, including the fact that the most recent market data is for 2015, so no one knows exactly how much affordable loan activity the market has produced over the last two years.  Offering his own solution, Sam demonstrated how valuable lending trends can be derived from public record data for any geographically targeted small areas such as low-income, minority, and high-opportunity areas.  For instance, we can see that the share of low-income areas is rising faster in metropolitan areas than in non-metros.  Sam further calculated both current and projected low-income lending share and volumes, which remain well below levels seen in the late 1990s and very early 2000s and vary widely by geography.

Following Sam’s presentation, the panel launched into a robust discussion, which began with Corianne Scally discussing some of the challenges facing rural markets and the importance of single-family homes in providing rental housing options.  She noted that single-family detached homes make up 43% of the rural housing market, and the GSEs understand the need to use creativity in addressing these areas of the country.  She expressed disappointment that the GSEs have not made enough progress in defining the colonias areas around the U.S.-Mexico border, and called for ideas that could benefit the large farm worker population that lives in that region.  

Having addressed both low-income and rural markets, the conversation turned to the third leg of the Duty to Serve initiatives, as Ann Kossachev focused her comments on manufactured housing and the chattel loan programs that both Fannie Mae and Freddie Mac are pursuing.  She noted the unique risks associated with manufactured housing, such as the fact that delinquencies typically happen later in the life of the loan, or that the various methods of titling can differ from region to region.  Another difficulty facing FHFA is the collection of chattel loan data, which the chattel industry is not often willing to share.

This is where Doug Ryan joined the discussion, providing insight on some of the recent data that is available on manufactured housing and chattel loans, specifically noting the difficulties in assessing and valuing these properties: “It’s hard to find appraisals that can do this stuff.  It’s hard to find comps that can do this stuff.”  He also addressed a lack of consumer protections in the industry, but mentioned we need more data to accurately assess the state of the program.  Finally, he advocated for further investment in Community Development Financial Institutions, to provide some of the grants and loans that are needed in the communities that Duty to Serve was designed to help. 

The final panelist of the evening, Ethan Handelman, held up a printed copy of the 239-page plan released by Fannie Mae to make his point that the GSEs’ Duty to Serve plans could be more accessible to the public, noting that most individuals/companies are not going to bother reading through the entire document.  He also highlighted a letter sent to the GSEs from the Green Affordable Housing Coalition, which suggested improving the Duty to Serve plans by including energy and water efficiency as a meaningful pathway to preserve affordable housing.  Finally, he noted that both GSEs are doing work in neighborhood stabilization, but only Fannie Mae included the practice in its Duty to Serve plan, which he found odd.

CoreLogic and the Urban Institute are currently in the early stages of planning the 13th installment of the Sunset Seminar series, and more information will be released in the months ahead.

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