Washington policymakers have responded to our concerns in several ways in recent days. The Fed has cut interest rates, FHA reform is moving through Congress and federal regulators are providing Fannie Mae and Freddie Mac more flexibility to address the subprime crisis. These developments are important first steps in our battle, and NAHB will continue to work for further improvements until balance is restored in the housing markets.

In the weeks leading up to the Fed's announcement that it would cut interest rates, NAHB's Economics team provided Chairman Bernanke with regular updates on the health of the housing sector, and the need to act decisively to bolster housing and the economy. And when the Office of Federal Housing Enterprise Oversight (OFHEO), regulator of Fannie Mae and Freddie Mac, announced Sept. 19 that it would allow the GSEs to raise their portfolio limits by 2% annually so they can invest more than $20 billion in subprime mortgages, this was another step in the right direction, although it fell short of what we continue to advocate. (NAHB is calling on OFHEO to allow Fannie and Freddie to raise their portfolio caps by 10% to buy more subprime loans, help keep buyers from foreclosure and keep mortgage money flowing.) The good news kept coming in this week with the House approval of an important FHA reform bill that included an NAHB-supported amendment offered by Reps. Barney Frank (D-MA), Gary Miller (R-CA) and Dennis Cardoza (D-CA). This amendment would enable more creditworthy borrowers to purchase an FHA-insured home in many high-cost metropolitan markets. Companion legislation is pending in the Senate.

In recent weeks, NAHB's lobbying team has been continually meeting with leading members of Congress in the effort to pass legislation modernizing FHA mortgages and reforming the housing GSEs so they can play a larger role in restoring stability in the mortgage markets. We've placed ads in influential publications on Capitol Hill (picture above) and conducted major media outreach efforts to get our messages heard. In fact, during the past few days alone, NAHB has appeared or been quoted in more than 50 major print, broadcast and wire outlets across the country, including USA Today, The Wall Street Journal, The Washington Post, Associated Press, Reuters, Dow Jones, The Seattle Times, the Dallas Morning News, the Atlanta-Journal Constitution, San Francisco Chronicle, St. Louis Post-Dispatch and The Philadelphia Inquirer, to name just a few.

Clearly, we still have a long way to go to restore health to the nation's mortgage markets and the overall housing industry, and there is no "quick fix" to the crisis at hand. In the days ahead, NAHB, its leaders and staff will continue to work tirelessly on behalf of our members toward steady progress and an eventual resolution to the challenges that lie ahead. Stay tuned to this report, NBN Online and other NAHB communications for continual updates on our progress.

NAHB Member Benefit:  NAHB Senior Officers and several CEOs representing the largest national home builders and manufacturers of housing products met with Fed Chariman Ben Bernanke in Washington on Sept. 5 to discuss the state of the nation's housing industry. Bernanke received first-hand accounts of how the sharp housing slowdown was affecting our members and their local economies and why bold action was needed to restore liquidity at the short end of the financial markets. The meeting and the substantial data that NAHB's Economics team provided to the Fed through regular updates on the housing market prior to Sept. 18 likely factored into the Fed's decision-making process as it chose to cut short-term rates by a greater margin than many had expected. [return to top]

- Grant FHA the authority to establish greater flexibility in setting 
  downpayment requirements for its single-family programs;

- Revise FHA requirements for condominium loans;

- Allow FHA to establish a risk-based mortgage insurance premium
  pricing structure that rewards higher-risk borrowers who establish
  a track record of timely payments;

- Permit the FHA to extend the maximum loan maturity to 40 years to
  enable borrowers to reduce  their monthly mortgage payments;

- Give the HUD Secretary increased flexibilty to increase the FHA multifamily
   loan limits in high-cost areas; and

- Allow the FHA to insure more "reverse mortgages" and increase the
  maximum loan amount.

The House-passed bill must now be reconciled with legislation currently pending in the Senate.

NAHB Member Benefit: During the past several weeks, NAHB's lobbying team has been meeting with leading members of Congress to pass legislation modernizing FHA mortgages and reforming Fannie Mae and Freddie Mac so that each of these can play a larger role in restoring stability in the mortgage markets. Contact: Scott Meyer, x8144. [return to top]