CREF Policy Update May 9: COMBOG Chair Testifies on Health of CRE Market; Identifies Regulatory Barriers

COMBOG Chair Testifies on Health of CRE Market; Identifies Regulatory Barriers

Last Tuesday, current MBA COMBOG Chairman Jeff Weidell, CEO of Northmarq, testified before the House Oversight & Accountability’s Health Care & Financial Services Subcommittee at a hearing titled, “Health of the Commercial Real Estate Markets and Removing Regulatory Hurdles to Ensure Continued Strength.”

• Read Weidell’s written and oral statements here and here; watch a recording of the hearing here.

Why it matters: Weidell’s testimony and responses to lawmakers’ questions centered on the need for changes to the Department of Housing and Urban Development’s (HUD) “hidden and unnecessary fees, which make it a multifamily lender ‘of last resort.’” He also indicated support for increasing affordable housing stock through tax changes that facilitate office conversions, and a reproposal of the Basel III Endgame proposed rule.

Go deeper: Weidell drew careful distinctions between today’s current CRE market conditions versus those of the Great Recession in an extended “question and answer” dialogue with the subcommittee’s Chair and Ranking Member near the close of the hearing. 

What’s next: MBA will continue to work with elected officials and regulators on impactful ways to continue to maintain an appetite for investment in commercial real estate – and increase the supply of affordable rental housing.

For more information, please contact Madisyn Rhone at (202) 557-2741 or Rachel Kelley at (202) 557-2816.

Federal Reserve Maintains Federal Funds Rate 

The Federal Reserve in its ongoing efforts to slow inflation decided to hold the federal funds rate to a target range of 5.25-5.50% last Wednesday.

Why it matters: The FOMC emphasized that, “the Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent. In addition, the Committee will continue reducing its holdings of Treasury securities and agency debt and agency mortgage‑backed securities. Beginning in June, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $60 billion to $25 billion. The Committee will maintain the monthly redemption cap on agency debt and agency mortgage‑backed securities at $35 billion and will reinvest any principal payments in excess of this cap into Treasury securities.”

What they are saying: Read MBA SVP and Chief Economist Mike Fratantoni’s full statement here.

For more information, please contact Mike Fratantoni at (202) 557-2935.

Treasury Secretary Janet Yellen Unveils “Green Book,” Defends Biden’s FY2025 Budget Proposal

Last Tuesday, Treasury Secretary Janet Yellen testified before the House Ways & Means Committee to detail President Joe Biden’s Fiscal Year (FY) 2025 Budget request. Her statements and responses to members’ questions covered: the Biden administration’s tax proposals; the expiration and potential renewal of key provisions of the 2017 Tax Cuts and Jobs Act (TCJA); the implementation of the Inflation Reduction Act (IRA); the need for expansion and improvement of the Low-Income Housing Tax Credit (LIHTC) program; and additional key economic and tax policy issues.

• A full summary of the hearing can be found here.

Why it matters: Yellen’s testimony and question and answer session touched on various aspects of economic policy that impact the mortgage banking industry – from proposed tax incentives to housing affordability to supply chain resilience and IRS modernization.

Go deeper: Treasury Secretary Janet Yellen unveiled the Biden FY25 “Green Book,” which contains an annual inventory of key tax proposals and their accompanying federal revenue and economic impacts.

What’s next: The hearing dialogue between Yellen and committee members provided a preview of the expected tax debate regarding TJCA provisions in 2025 – including the consideration of proposals that could materially impact the CREF industry.

For more information, please contact Madisyn Rhone at (202) 557-2741, Rachel Kelley at (202) 557-2816, and/or Bill Killmer at (202) 557-2736.

Acting Secretary Todman Testifies Before Appropriators on HUD’s FY2025 Budget Request

Last week, Acting Secretary Adrianne Todman testified before the Transportation and HUD (T-HUD) subcommittees of the House and Senate Appropriations Committees on HUD’s FY2025 budget request. A summary of the Senate hearing can be found here.  A summary of the House hearing can be found here.

Why it matters: Todman fielded questions on the FY 2025 budget request’s funding for housing and rental assistance, expanding the housing supply, addressing zoning barriers, disaster assistance, as well as a series of potential programmatic reforms. Both Democrats and Republicans emphasized the importance of expanding the nation’s rental housing supply within the constraints of a “flat” HUD budget.

What’s next: Congress will proceed to markup the twelve individual FY 2025 appropriations bills – including House and Senate versions of the T-HUD funding measure. MBA has submitted its annual letter to appropriators outlining priorities for the HUD budget that impact our CREF members that utilize HUD’s multifamily program platforms.

For more information, please contact Ethan Saxon at (202) 557-2913, George Rogers at (202) 557-2797, Rachel Kelly at (202) 557 2816, or Madisyn Rhone at (202) 557-2741.

MBA Joins Broad Housing Coalition Letter to Highlight Challenges/Solutions

Last week, MBA joined a broad coalition letter calling on lawmakers to enact policies to increase the nation’s housing supply – and lower costs dampening housing affordability.  The letter outlined an extensive number of bipartisan proposals geared towards expanding supply while lowering related housing delivery costs.

Why it matters: In more and more communities, too many hard-working Americans are unable to rent or buy homes due to increased inflation tied to shelter. These rising costs are driven by a lack of supply created by a complex series of barriers to development.  A coalition press release highlighting the release of the letter can be found here.

What’s next: MBA will continue to work with coalition partners to encourage Congress and the administration to address persistent housing affordability challenges highlighted within the letter.

For more information, please contact Ethan Saxon at (202) 557-2913, George Rogers at (202) 557-2797, Rachel Kelly at (202) 557 2816, or Madisyn Rhone at (202) 557-2741.

Upcoming MBA Education Webinars on Critical Industry Issues

MBA Education continues to deliver timely single-family and commercial/multifamily programming that covers the spectrum of challenges, obstacles and solutions pertaining to our industry. Below, please see a list of upcoming and recent webinars – which are complimentary to MBA members:

Basics of Commercial Loan Closing and Loan Documentation – May 9
Using Data and Technology to Connect with Today’s Buyers to Increase Homeownership – May 14
Rethink Everything: You “Know” To Be a Next Gen Loan Officer – A Deeper Dive with the Writers & Experts Webinar Series: Show Up on Video – May 14
Fundamentals of Secondary Marketing: Broad Concepts Every Mortgage Professional Should Know – May 15
Introduction to Commercial Mortgage-Backed Securities – May 23
Culturally Competent Marketing and Messaging for Hispanic Homebuyers and Homeowners – May 30

MBA members can register for any of the above events and view recent webinar recordings by clicking here.  

For any questions, please contacDavid Upbin at (202) 557-2931.