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Where we’ve been and where we’re headed in housing: Interview with Shaun Donovan

by Ethan Handelman, National Housing Conference

C-SPAN’s Newsmakers hosted a thoughtful interview of HUD Secretary Shaun Donovan by Nick Timiraos of the Wall Street Journal and Margaret Chadbourn of Reuters. Both reporters provide frequent and nuanced coverage of housing issues, and it shows in their questions. A few highlights from the conversation:

  • Principal write-downs. FHFA Acting Director Ed DeMarco is currently studying the question of whether to allow Fannie Mae and Freddie Mac to write down principal on underwater loans. Donovan made no specific predictions as to what the Administration would do if DeMarco maintained his opposition to write-downs, but he did suggest FHFA might have a legal obligations to allow write-downs.
  • Evaluating the responses to the housing crisis. Donovan’s message was clear on this point—we’re better off than we were when the Obama Administration took office. Basically a true observation, but also hardly a surprising message in an election year.
  • The goal to aim for. Donovan outlined the desired state of housing markets, in other words, what we’re aiming for. It’s not just making sure that housing is affordable to Americans, but also that they it as a safe investment. That confidence is essential to getting many housing markets stabilized, beyond just the few that are bouncing back or have remained somewhat resilient during the crisis.

The post-interview commentary from Timiraos and Chadbourne is worth sticking around for after the interview. Watch the full interview on C-SPAN.

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