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Multifamily Economists Weigh In On Liberal Mortgage Standards

MPF vice president provides his take on what Watt’s announcement could mean


(October 21, 2014) —
In this Multifamily Executive article, “Multifamily Economists React to Watt Announcement”, the recent announcement by Federal Housing Finance Agency Director Mel Watt about Fannie Mae and Freddie Mac backing loans with as little as 3 percent down to help bolster the housing market is debated by economists specializing in the multifamily industry.

MPF’s own Greg Willett stated “While the affordability challenge is a factor holding back home purchase by first-time buyers, it isn’t the only factor. Simple demographics probably are more important. The oldest Millennials are just now reaching the age when home purchase has been typical historically, and the group is waiting longer to marry, have kids and make other lifestyle changes that tend to trigger purchase. Plus, renting offers mobility in a shifting economy where job change is routine among young adults. We haven’t changed the world for the apartment industry by slightly tweaking mortgage lending standards. To the slight extent that home purchase could accelerate, the impact on apartments appears likely to be neutral. Yes, some renters will be lost to purchase, but an improving for-sale market will support job formation that could spur additional renter household formation.”

Read what other economists had to say here: http://www.multifamilyexecutive.com/business-finance/analysts-react-to-watt-annoucement_o

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