Bill Pulte, the director of the Federal Housing Finance Agency (FHFA) and chairman of Fannie Mae and Freddie Mac, recently provided insights into the current state of the housing market during an appearance on CNBC’s ‘Squawk Box.’ Pulte focused on the effects of mortgage rates, the agency’s role in combating inflation, and the future of the government-sponsored enterprises.
Throughout the conversation, Pulte really stressed the difficulty battlegrounds that the housing market is going. He noted that high mortgage rates continue to dampen home affordability. In turn, hopeful homebuyers are increasingly struggling to make it into the market. He acknowledged that these increased rates have brought home sales to a standstill. This trend has caused great concern among policymakers and other stakeholders within the industry.
Pulte did a great job digesting FHFA’s strategy to combat inflation. He reiterated that the agency is in favor of promoting stability in the housing finance system. This re-envisioning of the effort is intended to establish a more predictable climate for borrowers and investors alike. This is meant to avoid inflationary pressures that may occur from the volatility typically seen in the housing sector. Pulte noted his deepening belief that a well-balanced housing finance system should be a powerful force in stimulating our ultimate and sustainable economic recovery.
In giving testimony about the future of Fannie Mae and Freddie Mac, Pulte painted a vivid picture of different ways these government-sponsored entities could be reformed. He reiterated the importance of defending and expanding access to affordable housing. He stressed the need to keep an eye on fiscal responsibility. Pulte staked out the position that future changes would be primarily aimed at improving their own operational efficiencies and risk management abilities.
As Pulte spoke to these issues on ‘Squawk Box,’ he particularly emphasized the complex web of housing finance and larger economic trends. He understood that a healthy housing market was vital to prosperity in all sectors of the economy. It has effects across industries, like construction, retail and job creation.