WASHINGTON, D.C. - Housing finance reform must address the unique differences between the multifamily and single-family industries and maintain an explicit, paid-for federal guarantee for multifamily-backed mortgage securities that is available in all markets at all times. That was the core message from National Multifamily Housing Council (NMHC) and National Apartment Association (NAA) in today’s testimony before the House Financial Services Subcommittee on Housing and Insurance.
“Careful and correct housing finance reform is critical to a competitive and robust apartment sector that helps nearly 39 million people live in homes that are right for them. The industry builds vibrant communities by offering housing choice, supporting local small businesses, creating millions of jobs and contributing to the fabric of communities across the country,” said Bob DeWitt, President and CEO of GID Investment Advisers and Chairman of the National Multifamily Housing Council, representing both NMHC and NAA.
“The apartment industry is extremely capital intensive. Therefore, it is critical that housing finance reform provide consistent access to debt capital across geographies, markets, and product types if we are to meet the current and future demand for rental housing in America,” DeWitt explained.
As Congress considers housing finance reform, DeWitt urged lawmakers to consider six key principles:
- A reformed housing finance system must maintain an explicit, paid-for federal guarantee for multifamily-backed mortgage securities available in all markets at all times.
- There are inherent differences between the single family and multifamily sectors, both in how they operate and how they have performed.
- Private capital should dominate the multifamily sector wherever and whenever possible. Reform should ensure continued private-sector participation.
- Congress should protect taxpayers by continuing risk sharing and private capital participation.
- Congress must retain the successful components of the existing multifamily programs in whatever succeeds them.
- Congress should avoid market disruptions during the transition to a new system by clearly defining the government’s role in a reformed system and the timeline for transition.
DeWitt concluded his remarks before the Subcommittee by stating, “it is critical that the Federal Housing Administration continues to be a reliable source of construction and mortgage debt.”
DeWitt’s full testimony can be found here and the oral testimony can be found here.
