President Barack Obama reiterated his view that a recovering housing market is essential to an improving U.S. economy in an online forum Wednesday where consumers grilled the president on his housing plans.
“Homeownership is a quintessential element of the American dream,” Obama said. “Keeping the overall economy moving in the right direction means that there’s a stronger market for homes.”
The 30-minute event, moderated by Zillow CEO Spencer Rascoff, was live-streamed on the White House’s Web site. Zillow fielded housing questions from consumers ahead of time via social media and selected a handful to present to Obama at the forum.
The questions covered topics such as the Home Affordable Refinance Program, Fannie Mae and Freddie Mac, home affordability, and the effects of student loan debt on housing.
Rascoff said about 10 percent of the thousands of questions Zillow received were about HARP, the government program that allows underwater homeowners to refinance their mortgages. The Obama Administration is trying to expand HARP to help more struggling homeowners. Congress is currently weighing the next iteration of the program, known as HARP 3.0, which would qualify non-government-backed loans for refinancing.
NAR has supported HARP in the past.
“There shouldn’t be an ideological barrier to getting this done,” Obama said, referencing HARP 3.0 and reforms to mortgage giants Fannie Mae and Freddie Mac. “I have hope for them.” He said that he hopes the measures pass by the end of the year.
On Fannie and Freddie, Obama said he is aiming to reduce their portfolio of loans. His long-term goal is to have the private market “get in there and provide those loans, and have the government step in to make sure that homes that are not too upscale are available for young families, for veterans, for folks who may have some limited means,” he said. “We’re confident that the private market can step in and do a good job.”
NAR has long called for replacing Fannie and Freddie while ensuring continued mortgage market liquidity through the maintenance of an explicit federal presence in the market.
Another theme that surfaced during the online forum was affordable rentals. When one young man asked the president how he would be able to afford a mortgage while strapped with a massive amount of student loan debt, Obama suggested that more Americans should consider renting a viable option.
“All of us, long-term, have the aspiration of owning a home of our own,” Obama said. However, “[renting] is not something that people should shy away from … that renting is the best option until you can purchase safely and soundly.”
He said that he is putting forth initiatives to get more affordable rental housing on the market to service those who can’t qualify for a mortgage yet. He also said he is focused on driving down college debt.
Obama talked mainly about what his administration has done thus far to help homeowners, and he hit some talking points from his housing-policy speech in Phoenix on Tuesday. He did not offer any new policies during Wednesday’s forum.