Entries by Edward Pinto

Index finds Rallying Home Purchase Market in 2016

Today, AEI’s International Center on Housing Risk (ICHR) and First American Financial Corporation release the AEI/First American National Housing Market Index (NHMI), the first index ever to analyze sales transaction volume for the entire home purchase market. The national housing market continued its rally in the fourth quarter of 2016. On an annualized basis, 5,810,000 […]

It’s Time to Put the Market Back in Housing Finance

Today’s government-centric housing finance system is an “economics free zone” indifferent to supply and demand. Composed of an alphabet soup of agencies, this system has fostered a massive liberalization of mortgage terms and provided countless trillions of dollars in lending in up and down markets. At the same time, other government polices constrain supply. As […]

Affordable multifamily housing loans need rethinking: The ‘Blight Preventer’ Loan

Ten to twenty years after their original development many affordable multifamily properties face two common shortcomings: an inability to fulfill their long-term affordability commitments without additional public subsidies and insufficient funds for proper maintenance and avoidance of blight.  The propensity for blight, leaves public funders with bad choices: accept blight or throw good money after […]

Housing Finance’s Two Punch Bowls by the Federal Government Should Be Removed

As famously stated by Fed Chairman William McChesney Martin in 1955: “The Federal Reserve, after the recent increase in the discount rate, is in the position of the chaperon who has ordered the punch bowl removed just when the party was really warming up.” As the Fed is now finding out, removing the punch bowl […]

Why the 20-Year Mortgage Is the Answer to Housing Finance Mess

A recent Associated Press poll found more than six in 10 respondents expressed only slight confidence — or none at all — in the ability of the federal government to make progress on important issues facing the country. The public’s skepticism is well founded, especially when it comes to federal housing policy. Notwithstanding an alphabet […]

Five Housing Market Predictions for 2016

My predictions for 2016: The National Mortgage Risk Index (NMRI), particularly for First-Time Buyers (FTBs), will continue its upward trend that is now nearly 3 years old. Demand pressure resulting from continuing moderate economic growth combined with increasing leverage and limited housing supply growth will extend the seller’s market that is now over 3 years […]

Serious flaws uncovered in Federal Reserve’s Bank Lending Practices

New analysis by Tobias Peter, research analyst at AEI’s International Center on Housing Risk (ICHR), uncovered serious flaws with respect to the Federal Reserve’s quarterly Senior Loan Officer Opinion Survey on Bank Lending Practices when compared to ICHR’s much more comprehensive and timely National Mortgage Risk Index (NMRI). Earlier this week the Fed released the […]

Loosening of Lending Standards Harms Low Income and Minority Americans

The Spring home buying season continues to show strength, buoyed by strong first-time buyer volume and share. Historically low mortgage rates, an improving labor market, and loose credit standards, combined with a 32-month-long seller’s market for existing homes, continue to drive up home prices faster than income. The continued loosening of lending standards during a […]

REPORT: Housing Market at Risk

April’s results continue to show that first-time buyer volume and share remain strong, showing little variance beyond seasonal trends.  However, the first-time buyer Mortgage Risk Index hit a series high of 15.28 percent in April, moving deeper into the high risk loan category. This growing leverage puts the housing market at risk given interest rates are […]

Film Suprime 2.0: Doubling Down on Disaster

The central role housing policy played in causing the financial crisis has been gaining greater and greater acceptance, but much more remains to be done as new efforts are underway to double down on disaster. Earlier this year, my colleague Peter Wallison came out with his new book Hidden in Plain Sight: What Really Caused the World’s […]

First-Time Buyer Mortgage Share and Mortgage Risk Indexes (FBMSI and FBMRI) for February 2015

SUMMARY: First-time buyers accounted for nearly 56 percent of primary owner-occupied home purchase mortgages with a government guarantee, up slightly from the prior February. The Combined FBMSI (which measures the share of first-time buyers for both government-guaranteed and private-sector mortgages) stood at an estimated 50 percent. The number of primary owner-occupied purchase mortgages going to […]