A New Lease on Loans: Ideas for Multifamily Housing Reform

Video

Post-Event Summary
With the growing sentiment against government involvement in single-family housing finance, should the government also move out of multifamily housing finance? On Wednesday, the American Enterprise Institute hosted a panel of multifamily finance experts to discuss the research of panelists Thomas White and Charlie S. Wilkins about the future of multifamily housing finance reform. White, previously of Fannie Mae and the Federal Housing Administration, emphasized that the research is a work in progress, with the goal being to develop a process by which the housing finance community can have a healthy private-capital marketplace for multifamily housing. Wilkins, an adviser to the US Department of Housing and Urban Development, made a strong case against government finance intervention by pointing out that it takes away too much risk from the marketplace. Some risk is good for proper decision making, he contended, as is some difficulty in borrowing money in the capital markets. He went on to detail how federal intervention distorts capital flows through loan guarantees. In response to the research, John C. Weicher of the Hudson Institute pointed out how the loan guarantee bias for large (50+ unit), multifamily housing creates specific resource-sapping contracts that generally reduce the amount of new large, multifamily contracts. Thomas Watt, member of the board of directors of Enterprise Community Investments, added that the underwriting standards for low-income, multifamily housing and the public policy that stems from it should be examined, as high-quality large, multifamily housing cannot exist without excessive government subsidies.
---MATTHEW HAUBACH

Event Description
Over the decades, single- and multifamily housing have vied for government attention, often with disastrous consequences for one or both. While growing consensus is that the government must reduce its involvement in single-family finance, many argue for continued or even expanded involvement in multifamily finance. And rental housing is gaining prominence in the housing reform debate as it becomes more obvious that ownership is not for everyone. Supporters of a government role plead for one form or another of continuing government guarantees of private multifamily mortgage loans, but is this really necessary? And does government involvement help lower rents for low- and moderate-income households? At this event, Thomas White and Charlie S. Wilkins, drawing on their long involvement in multifamily finance, will present their prescription for the future of multifamily housing finance reform, and John C. Weicher and Thomas Watts will draw from their own deep wells of experience to comment on the presentation.

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About the Author

 

Charles S.
Wilkins
  • American Enterprise Institute (AEI) adjunct scholar Charles Wilkins is an affordable housing expert. As a principal of the Compass Group LLC, he advises governmental and private clients in rental housing policy, including rental housing finance and project and loan performance. At AEI, his work focuses on multifamily housing policy and finance.


    Earlier, Wilkins worked for the National Housing Partnership. He is the author or coauthor of four books that were published or co-published by the Compass Group LLC: “Managing Occupancy: A Companion Guide to HUD’s Occupancy Handbook” (2004), “Fair Housing: A Guidebook for Owners and Managers of Apartments” (2000), “Shelter From The Storm: Successful Market Conversions of Regulated Housing” (1998), and “Managing Housing Credit Apartments: A Question & Answer Handbook for Property Owners and Managers” (1998).


    Wilkins has a B.A. from the University of North Carolina at Chapel Hill.

  • Phone: 703.217.8394
    Email: cwilkins@compassgroup.net
  • Assistant Info

    Name: Emily Rapp
    Phone: (202) 419-5212
    Email: Emily.Rapp@aei.org

 

Thomas W.
White
  • Tom White is an adjunct fellow at the American Enterprise Institute (AEI). An expert in housing policy, White has public service and technical experience in the financing, building, and managing of multifamily and single family housing. At AEI, he continues his work in housing policy, including housing finance and affordable housing.

    Early in his career, White served as a Michigan State legislator (11th District). He went on to work for the Michigan State Housing Agency where he oversaw the development (construction lending) and financing of single-family and multifamily housing. Later, at the US Department of Housing and Urban Development, he was in charge of bond finance and state agency programs for housing policy. White has also worked in senior positions at the National Council of State Housing Agencies, at Bear Stearns Investment Bank, and at Fannie Mae until his retirement in 2001. Since then, he has been a trustee of Center Line Capital, which specializes in multifamily finance and equity investments.

    White has a B.A. in history from Wayne State University. He has also done postgraduate work in sociology.

  • Email: twhite518@gmail.com
  • Assistant Info

    Name: Emily Rapp
    Phone: (202) 419-5212
    Email: Emily.Rapp@aei.org

 

Edward J.
Pinto
  • American Enterprise Institute (AEI) resident fellow Edward J. Pinto is the codirector of AEI’s International Center on Housing Risk. He is currently researching policy options for rebuilding the US housing finance sector and specializes in the effect of government housing policies on mortgages, foreclosures, and on the availability of affordable housing for working-class families. Pinto writes AEI’s monthly Housing Risk Watch, which has replaced AEI’s FHA Watch. Along with AEI resident scholar Stephen Oliner, Pinto is the creator and developer of the AEI Pinto-Oliner Mortgage Risk, Collateral Risk, and Capital Adequacy Indexes.


    An executive vice president and chief credit officer for Fannie Mae until the late 1980s, Pinto has done groundbreaking research on the role of federal housing policy in the 2008 mortgage and financial crisis. Pinto’s work on the Government Mortgage Complex includes seminal research papers submitted to the Financial Crisis Inquiry Commission: “Government Housing Policies in the Lead-up to the Financial Crisis” and “Triggers of the Financial Crisis.” In December 2012, he completed a study of 2.4 million Federal Housing Administration (FHA)–insured loans and found that FHA policies have resulted in a high proportion of working-class families losing their homes.

    Pinto has a J.D. from Indiana University Maurer School of Law and a B.A. from the University of Illinois at Urbana-Champaign.

  • Phone: 240-423-2848
    Email: edward.pinto@aei.org
  • Assistant Info

    Name: Emily Rapp
    Phone: 202-419-5212
    Email: emily.rapp@aei.org

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