DS News

61 WHAT'S AHEAD FOR HUD/FHA In March, Marcia Fudge was sworn in as the eighteenth HUD Secretary. She's the second Black woman in history to hold the position. Fudge has said that her desire is to make the dream of homeownership—and the security and wealth creation that comes with it—a reality for more Americans. Steve Bartlett says, so far, HUD has been "remarkably quiet in 2021" but he expects the department to be "increasingly assertive." "Secretary Fudge is very capable and highly regarded on Capitol Hill. She will likely emphasize racial equity in her agenda, among other priorities. She also is quite committed to the alleviation of poverty," Bartlett said. "But her exact housing priorities have yet to be announced. As she said at her confirmation hearing, her first priority was to provide rental assistance to households at risk of eviction. Now that we are opening up again, we should see some focused plans from HUD to end discriminatory housing policies." Some experts are also praising what Fudge has not done. Shortly after her Senate confirmation, Secretary Fudge ruled out calls for an FHA mortgage insurance premium cut. is was welcome news to Tobias Peter, who contributed to a paper entitled "e Impact of Federal Housing Policy on Housing Demand and Homeownership," which examined similar cut made in 2015 and found that it did not live up to its billing. "At the time, the FHA claimed that the premium drop would result in 250,000 new first-time buyers over the next three years and save each FHA buyer $900 annually. "Our research found that even though FHA's loan volume increased substantially in the first year after the 2015 premium cut, only about 17,000 were new first-time buyers who wouldn't have bought homes absent the premium cut, far short of FHA's prediction. e rest were borrowers poached from other federal agencies or buyers who purchased homes unrelatedly to the premium drop." His research also revealed that prices went up for non-FHA buyers in neighborhoods with FHA-insured sales. "After all, it is one housing market, where borrowers, no matter the financing, compete for houses," Peter explained. "is caused the non-FHA buyers, who did not receive the benefit of lower premiums, to largely offset the price increase by buying a home of lesser quality, perhaps a smaller home, a smaller lot, or in a different location." It comes back to the supply shortage, he says. "In today's hot housing market, any policy that stokes demand against a limited supply will fail similarly." He says that while some voices continue to call for a renewed MIP cut or for down payment assistance, given the current supply shortage, such policies will not benefit prospective buyers, and he hopes Secretary Fudge "will withstand such calls." Christina Hughes Babb is a reporter for DS News and MReport. A graduate of Southern Methodist University, she has been a reporter, editor, and publisher in the Dallas area for more than 15 years. During her 10 years at Advocate Media and Dallas Magazine, she published thousands of articles covering local politics, real estate, development, crime, the arts, entertainment, and human interest, among other topics. She has won two national Mayborn School of Journalism Ten Spurs awards for nonfiction, and has penned pieces for Texas Monthly, Salon.com, Dallas Observer, Edible, and the Dallas Morning News, among others. "Secretary Fudge is very capable and highly regarded on Capitol Hill. She will likely emphasize racial equity in her agenda, among other priorities." —Steve Bartlett, Senior Advisory Board Member, Treliant; President & CEO, Financial Services Roundtable (1999-2012), Representative to the U.S. Congress (1991-1993)

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