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35 » VISIT US ONLINE @ DSNEWS.COM MORE RENTERS LOOKING TO BUY THESE DAYS More and more consumers believe that the time is right to buy a house, according to an annual survey by the Federal Reserve Bank of New York. e New York Fed's Survey of Consumer Expectations (SCE) Housing Survey, conducted in February 2016 and just recently released, showed a substantial increase in the percentage of consumers who plan to become homeowners in the near term. Conditional on moving within three years, the average probability of buying a home rose from 59.9 percent in 2015's SCE Housing Survey up to 63.0 percent for 2016's survey. According to the New York Fed, the average probability of buying a home was especially pronounced among renters—the share of renters who said they plan to buy a home jumped from 43.2 percent up to 48.9 percent, according to the New York Fed. Renters continued to show a strong preference to owning a home; whereas in 2015, 68.5 percent of renters said they preferred or strongly preferred to own, provided they had the financial resources to do so. at share shot up to 74.2 percent in 2016. And though renters still generally perceive that obtaining a mortgage would be difficult, that percentage has shown steady improvement over the previous two surveys (12.8 percent in 2014, 14.7 percent in 2015, up to 17.5 percent in 2016). e attitudes toward housing remained generally positive, with 59.2 percent of respondents saying they think that buying a property in their zip code is a good investment, compared to only 13.2 percent who said they believe it is a bad investment. e share of respondents who said housing is a very good investment has risen from 14 percent in 2014 up to 21 percent in 2016; however, the percentage of respondents who said they believe housing is a bad investment more than doubled during that same period (1.3 percent up to 2.9 percent), according to the New York Fed. A recent survey from Redfin indicated that high rents, brought on by an increase in demand for rental housing due to the tight supply of homes for sale, are starting for force renters to become homeowners. e survey, which covered 975 homebuyers in 36 states and Washington, D.C., in May, reported that one in four respondents said the high cost of rent prompted them to search for a home to buy. e February 2016 SCE Housing Survey was the third annual installment of the survey conducted by the New York Fed. GROUPS CALL FOR ACTION ON HOUSING FINANCE REFORM Housing finance reform is once again taking center stage as several industry stakeholders have sounded off on the topic, stressing the importance of protecting taxpayers and the mortgage industry in general. Several housing advocacy groups and civil rights groups wrote a letter to FHFA Director Mel Watt urging him to cease making dividend payments to Treasury from the GSEs, thus preserving their capital buffer, which is scheduled to be reduced to zero by January 1, 2018. Watt himself sounded the alarm in the industry back in February when he said in a speech at the Bipartisan Policy Center that there were risks facing Fannie Mae and Freddie Mac that were "certain to escalate" the longer they remain in conservatorship of the FHFA— namely, the elimination of the GSEs' capital buffer. Ten groups signed the letter to Watt, including Community Mortgage Lenders of America, Center for Responsible Lending, Community Home Lenders Association, National Community Reinvestment Coalition, and the NAACP. e groups stated about the reducing of the GSEs' capital buffer to zero, "is course of action is likely to destabilize the housing economy, undermine efforts to make housing finance more accessible and affordable, and drive up the costs of homeownership." e groups in the letter agreed with Watt's assessment of the risk posed to taxpayers by the reducing of the GSE capital buffer and pointed out that the director has "sole discretion on whether or not to declare quarterly dividends on GSE Senior Preferred Stock. e groups urged Watt to use his authority granted by the Housing and Economic Recovery Act of 2008 to suspend GSE dividend payments to Treasury and "implement capital restoration plans so they have enough capital to safely manage their business and to support America's housing finance system." Also in the area of housing finance reform this week, the Financial Services Roundtable (FSR) called on presidential candidates to reveal their plans for housing finance reform, which includes how they will handle the end the conservatorship and the risk it poses to taxpayers. e FSR posed five questions to the presidential candidates regarding housing finance reform: » How will the future system protect taxpayers? » How will private capital be brought into the current system? » How will the new system enable consistent sources of credit for consumers through the 30-year fixed rate mortgage and similar stable products? » What will the transition be from Fannie Mae and Freddie Mac to a new system? » Will you build on the current efforts underway to expand credit risk sharing, utilize a common securitization? "Since 2008, Fannie Mae and Freddie Mac have been in 'conservatorship,' which leaves taxpayers at risk for future bailouts while providing no long-term solution to ensure consumer access to stable mortgage credit in the future," FSR's Housing Policy Council President John Dalton said. "e presidential candidates have an opportunity to better protect taxpayers and help consumers by making housing finance reform a top priority." FSR and its Housing Policy Council are advocating for comprehensive housing finance reform that includes gradually winding down the GSEs and replacing them with a structure backed by private capital. Bankruptcy filings nationwide totaled 66,094 in May 2016, a decline of about 4,400 from April and a decline of about 3,200 from May 2015, according to AACER Bankruptcy Data reported by Epiq Systems. KNOW THIS

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