3 Real Estate Issues to Remember While You Watch the Mid-Terms

If you are like most people, you are probably ready for the midterm elections to be over. However, unlike most people, you probably realize that when the ballots are counted and the political ads pulled from the local radio and television stations, that is when the real results of the elections really begin to manifest. Many on both sides of the aisle view the results of the midterms, whatever they may be, as a referendum on the sitting presidential administration. However, these elections will have some more practical applications as well, including three distinct outcomes for housing and real estate:

First, the outcomes will determine the speed at which Fannie Mae and Freddie Mac meet their fate.

While the government-sponsored enterprises have been the topic of discussion for a while in Congress, that conservatorship could be unwound much more quickly if conservatives hold either or both houses. This could be done without legislative approval, but that is much more likely if republicans hold Congress or if the margins between the two parties remain slim.

Second, votes will directly affect affordable housing legislation.

Proposed legislative actions affecting affordable housing will definitely be swayed based on the results of the mid-terms. “The 2018 lame-duck session could be fertile ground for long-desired legislation for affordable housing, community development, and historic preservation advocates,” wrote certified public accountant Michael Novogradac on the topic. He suggested that affordable housing reforms, including a number of tax-incentive and -credit programs, could pass as provisions of other bipartisan measures if the parties losing, keeping, or holding power feel it useful to push these items through. However, he warned, “bad blood between the parties – a common theme in recent years – could lead to less cooperation.”

Third, funding, staffing, and support for the Consumer Financial Protection Bureau (CFPB), is in play.

The CFPB has been dramatically reduced under the current administration, which critics say has removed a powerful defense mechanism from the side of home-buyers and supporters note has enabled the financial mechanisms that fund most housing purchases to start lending, to some degree, once again. A shift in political power in Congress will certainly tend toward ramping up of some of the CFPB’s more controversial and limiting programs that loan originators say sometimes compelled them to make unprofitable and even bad loans to consumers simply to meet existing regulations.

Did you vote? Why or why not?