211: The New Reform That Could Unlock $1B+ for Affordable Housing w/Sharon Cornelissen

On The Market

BiggerPockets

News, Investing, Business, Education

4.8 • 820 Ratings

🗓️ 25 April 2024

⏱️ 31 minutes

🔗️ Recording | iTunes | RSS

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Summary

America is in need of affordable housing; we’re all aware. Buying your first home has become increasingly challenging for everyday people. This is where housing subsidies come in. Federal housing subsidies were created over ninety years ago to help Americans get into the housing market and strengthen the economy, but in 2024, much of that money may not be headed to homebuyers—it could be going to banks instead. On today’s show, we talk to Sharon Cornelissen, Ph.D., Director of Housing at the Consumer Federation of America. Sharon’s mission is to advocate for safe, affordable housing with equitable mortgage lending for American consumers. In this episode, Sharon illuminates the shocking fact that most Americans are completely unaware of—billions in housing subsidies AREN’T being used for housing. So, if they’re not going to homebuyers, where are all the subsidies headed? Sharon discusses the banks that could be receiving a significant amount of these subsidies without providing any benefits for homebuyers, how the Coalition for Federal Home Loan Bank Reform is trying to change this, and how, if they succeed, affordable housing could see a MASSIVE influx in subsidies, that could help the housing market tremendously. In This Episode We Cover: Where the $7.3 billion in housing subsidies is actually going The Federal Home Loan Bank system and why it’s in dire need of reform How the mortgage market changed over the past century and why we’re seeing these problems How over $1 billion could be directed straight towards affordable housing How Sharon picked up a $7,000 house in one of the most devastated real estate markets And So Much More! Links from the Show Find an Agent Find a Lender BiggerPockets Forums BiggerPockets Agent BiggerPockets Bootcamps Join BiggerPockets for FREE On The Market Join the Future of Real Estate Investing with Fundrise Connect with Other Investors in the “On The Market” Forums Subscribe to The “On The Market” YouTube Channel Dave's BiggerPockets Profile Dave's Instagram Kathy's BiggerPockets Profile Kathy's Instagram BiggerPockets' Instagram Consumer Federation of America Federal Home Loan Banks Connect with Sharon: Coalition for FHLB Reform Sharon's LinkedIn Sharon's X/Twitter Jump to topic: (00:00) Intro (01:17) Buying a $7,000 House! (04:41) $7.3B in Housing Subsidies! (11:45) Is It Working? (14:44) The Big Problem (18:59) A Solution for Affordable Housing Check out more resources from this show on BiggerPockets.com and https://www.biggerpockets.com/blog/on-the-market-211 Interested in learning more about today’s sponsors or becoming a BiggerPockets partner yourself? Email [email protected]. Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	The Congressional Budget Office recently estimated that a whopping $7.3 billion of subsidies
0:08.1	are going to something known as the federal home loan banking system. This is a little
0:15.9	known part of the financial system. At least it's not something that I knew about before
0:20.4	starting to
0:21.1	research this show. And with a budget like $7.3 billion, you would think that this should be
0:27.0	having a huge impact on affordability and the housing market as a whole. But today we're going
0:33.2	to dig into whether that's actually happening or not.
0:43.4	Hey, everyone, and welcome to On the Market.
0:45.0	I'm your host, Dave Meyer.
0:48.3	And today we have an excellent guest joining us today.
0:54.0	Her name is Sharon Cornelison, who is the Director of Housing for the Consumer Federation of America.
0:55.8	And with Sharon today, we're going to talk about the history of these subsidies that are going
1:01.2	to the federal home loan banks and what's going on with them today.
1:05.9	And we'll talk about how some proposed reforms that are going through Washington, D.C. right now
1:10.6	could impact
1:11.7	affordable housing and housing inventory going forward. All right, let's bring on Sharon.
1:25.2	Sharon, welcome to the show. Thanks for being here.
1:28.7	Yeah, thanks for having me.
1:37.0	To start off, tell us a little bit about what it means to be the director of housing for the Consumer Federation of America.
1:49.0	Yeah, so the Consumer Federation of America is a national, nonpartisan pro-consumer organization that leads in research and advocacy on pro-consumer issues.
1:50.0	So as a director of housing, I'm responsible for all our positions on housing and housing policy.
1:56.0	I do both research and advocacy on housing.
	...

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