I'm Jerry Willis, and this is the Fox Business Rundown.

Friday, October 10th, 20205.

The housing market is colder than an ice cube, but could an overhaul of Fannie and Freddie turn things around?

There's inevitably going to be some messiness to this, I think, because we've ended up in the wrong place. We've ended up in a place they were never supposed to be. Conservatorship was supposed to be a couple of months and then out, and that never happened. It's a bad time to buy a house. That's what nearly three-quarters of consumers are saying, according to Fannie Mae's home purchase sentiment index released earlier this

week. Despite a drop in mortgage rates, only 27% of Americans say it's a good time to buy. The same

survey, however, does say it's a good time to sell, with 57% of consumers saying it would be a good

time to put their home on the market.

In hopes to get home builders building again, President Trump has floated the possibility of once again privatizing Fannie Mae and Freddie Mac and offering an IPO, which could be one of the

biggest stock offerings in history. The government-sponsored enterprises that essentially guarantee most of the mortgages

made in the U.S. have been in conservatorship since the 2008 financial crisis. In other words,

they're backstopped by the U.S. government, in other words, taxpayers. So is an overhaul at Fannie

and Freddie the answer to housing market needs? And how complicated

would that overhaul be? Well, Fannie Mae and Freddie Mac were put into conservatorship in the financial

crisis. So that's a long time ago now, 17 years. Douglas Holt-Siegan is an economist and the

former director of the Congressional Budget Office. And they've been living in this halfway house where they're sort of government agencies and sort of private entities,

and they've been on the backstop of the Treasury the entire time.

And so it's time to sort of go forward and decide what they're going to be.

They can be returned to the private sector and have a

useful function in generating private mortgage-backed securities, but to do so, they have to

clean up their capital structure and things like that. Is there a lot of work to do?

There's a lot of work to do. So doing it quickly, I think, would be a mistake. Doing it would be a good idea. It's long

overdue in my view. But they're large entities. They have to be well capitalized, and they are

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