January 11, 2017

In Case You Missed It: A Look at Recent National Housing Policy News

Hensarling Announces New Financial Services Subcommittee Chairs 

House Financial Services Committee Chairman Jeb Hensarling (R-TX) announced the Committee's structure and leadership for the 115th Congress. The Committee oversees many key federal housing agencies, including HUD, the U.S. Department of Treasury, the Consumer Financial Protection Bureau (CFPB), as well as government-sponsored enterprises (GSEs) Fannie Mae, Freddie Mac, and the Federal Home Loan Banks (FHLBs). Sean Duffy (R-WI) is the new chairman of the Housing and Insurance Subcommittee, which oversees HUD programs. Duffy replaces Blaine Luetkemeyer (R-MO), who will now chair the Subcommittee on Financial Institutions and Consumer Credit, which has jurisdiction over CFPB. The Housing Subcommittee will now also have jurisdiction over the GSEs. This is a departure from recent Congresses, when the GSEs were overseen by the Capital Markets and Government Sponsored Enterprises Subcommittee.

Housing Market Regains All Value Lost in Crisis 

The total value of the U.S. housing stock grew to a record-high $29.6 trillion in 2016, according to data released by Zillow. In terms of appreciation, the housing market grew 5.7 percent in value, or $1.6 trillion, effectively regaining all of the value it lost during the housing crisis. The Los Angeles and New York metro areas recorded the highest shares of the country's overall housing value, at 8.6 percent and eight percent, respectively, followed by the San Francisco metro area, which was worth 4.2 percent of the overall housing value. Also during 2016, renters paid $478.5 billion in housing costs, a $17.7 billion increase from 2015. About 635,000 new renter households were formed in 2016 as apartment renters spent nearly $50 billion more than renters of single-family homes.

FHFA: Seriously Delinquent GSE Loans at Lowest Level Since 2008

The Federal Housing Finance Agency reported the serious delinquency rate for mortgages owned or guaranteed by Fannie Mae and Freddie Mac reached the lowest level since June 2008.
The government-sponsored enterprises' serious delinquency rate fell to 1.16 percent at the end of the third quarter, the report said (https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/FPR_3Q2016.pdf). Overall, the GSEs completed 46,390 foreclosure prevention actions in the third quarter, bringing the total number of foreclosure prevention actions to more than 3.7 million since the start of the conservatorships in September 2008, of which 1.993 million represented permanent loan modifications.

FHA To Reduce Annual Insurance Premiums On Most Mortgages

Modest reduction expands credit access and reflects improved economic health of FHA
As the nation’s housing market continues to improve, U.S. Housing and Urban Development Secretary Juli├ín Castro announced the Federal Housing Administration (FHA) will reduce the annual premiums most borrowers will pay by a quarter of a percent.  FHA’s new premium rates are projected to save new FHA-insured homeowners an average of $500 this year.
FHA is reducing its annual mortgage insurance premium (MIP) by 25 basis points for most new mortgages with a closing/disbursement date on or after January 27, 2017.  For a full schedule of the new premium rates announced today, read FHA’s mortgagee letter.

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