House Subcommittee Holds Third Hearing on Private Sector Perspectives on Housing Finance Reform

The House Financial Services Housing and Insurance Subcommittee held on November 7 the third hearing in a series on private sector perspectives on housing finance reform. While one witness, Peter Wallison of the American Enterprise Institute, asserted that the government sponsored enterprises (GSEs), Fannie Mae and Freddie Mac, should be eliminated entirely, others on the panel warned against a fully privatized mortgage lending market. Representative Emanuel Cleaver (D-MO) stated that GSE reform must help address the affordable housing crisis. Alanna McCargo of the Urban Institute also spoke about the need for expanded housing affordability for both renters and owners.

Although the hearing was not related to the current tax reform debate, committee members raised concerns about the impact the House Republican tax reform bill would have on affordable housing. Representative Beatty (D-OH) asked the witnesses how the House bill’s proposal to eliminate private activity bonds would affect the supply of affordable housing. Ms. McMargo affirmed the need for the Low Income Housing Tax Credit (LIHTC) program, as well as the need to put savings from reforms, such as lowering the mortgage interest deduction cap, back into housing.

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