New Info Graphic Paints a Sad Picture of How Far Lending to Under-Served has Fallen
The Urban Institute's Housing Finance Policy Institute launched a year ago with a commitment to bringing unbiased and factual information to the housing debate. This most recent release shows the progress made in understanding what is actually happening in markets today. This info-graphic is a stunning story of America's housing finance system's failure to serve minorities.
|Visit the Urban Institute's Info Graphic to drill down|
According to the data, this may represent one of the contributing factors to the sluggish housing recovery. Taking 13% of the market out of the equation could have that effect.
Interestingly, FHFA just announced the proposed affordable housing goals for Fannie Mae and Freddie Mac. Aside from the fact that these "affordable housing" goals provide a politically correct subtext for lending to minorities, these goals do not increase current objectives substantially, except for targeting low income areas instead of individuals.
|A 3% annual increase in Low Income purchases goals is not going to replace|
the 13% of the population excluded since the crash. Source Federal Housing Finance Agency
For those involved in primary origination, perhaps this is the signal to develop business models that focus on minority markets. Failure, on the part of the industry, to provide a private sector solution to this problem in today's environment of regulated compensation and higher priced mortgage lending restrictions would acknowledge the real problem; today's regulatory scheme deprives a large segment of the population of access to home ownership.
This data show continued regulatory insistence on consumer protection by stifling private enterprise will ultimately hurt all Americans by creating wealth inequality, and depressing markets broadly.
Bai, B. & George, T. A new view of the housing boom and bust. (2014, September 10). Retrieved September 18, 2014, from http://datatools.urban.org/Features/mortgages-by-race/#5/39.809/-94.812
Russell, C., & Johnson, S. (2014, August 29). Affordable Housing Goals for 2015-2017. Retrieved September 18, 2014, from http://www.fhfa.gov/Media/PublicAffairs/Pages/FHFA-Proposes-2015-2017-Housing-Goals-for-Fannie-Mae-and-Freddie-Mac.aspx