Top 3 Things to Know from Washington
1. MBA President and CEO Bob Broeksmit Testifies on Capitol Hill on Basel III Bank Capital Proposal
MBA President and CEO Bob Broeksmit, CMB, testified before the House Financial Services Committee’s (HFSC) Subcommittee on Financial Institutions and Monetary Policy on Thursday, September 14, to highlight real estate finance industry concerns with the banking agencies’ proposed changes to bank capital requirements. The so-called “end game” proposed rules complete U.S. regulators’ implementation of the Basel III standards and ostensibly make changes in response to the recent large bank failures. A summary of the hearing can be found here, and a video recording can be found here. Click here for MBA’s written testimony.
By appearing on MBA’s behalf, Bob was able to address (and answer questions from) a bipartisan House group to reinforce our industry’s opposition to certain provisions of the proposal that would undermine mortgage credit availability, highlighting for them how the proposed rule would affect both the single-family housing and commercial real estate finance markets.
The testimony also outlined how the proposal would undermine certain specific key policy objectives, including efforts to close the racial homeownership and wealth gaps, the provision of affordable housing (both ownership and rental), the promotion of competition over consolidation, and the upcoming unveiling of a final Community Reinvestment Act rule.
Comments on the Basel III proposal are due by November 30, 2023, with July 1, 2025, as the start of a three-year transition period provided for the final rule. MBA created a summary of the proposed rule and will work with members and other industry stakeholders to formulate our response, focusing on the numerous negative impacts these proposed rules would have on the housing finance ecosystem.
2. Senate Panel Hold Important Hearing on Insurance Challenges
On September 7, the Senate Banking, Housing, and Urban Affairs Committee held a hearing entitled, “Perspectives on Challenges in the Property Insurance Market and the Impact on Consumers.” A summary of the hearing can be found here. MBA submitted a letter/statement for the record ahead of the hearing on top industry priorities, including the need to reauthorize the NFIP (set to expire on September 30, 2023) and addressing the rising costs and declining availability of private property insurance coverage. We have continued to collaborate with members of Congress on both sides of the aisle to stress the critical need to develop workable state and local solutions to the current insurance crisis.
3. MBA Leads Efforts to Push Back on Flawed Rent Control Policies
Both House and Senate Democrats have continued urging Federal Housing Finance Agency (FHFA) Director Thompson to limit rent increases at multifamily apartment units with mortgages financed by Fannie Mae and Freddie Mac (the GSEs). Earlier this year, FHFA issued a request for input (RFI) on potential tenant protections for multifamily properties in its portfolio. The related House and Senate letters from the Democrats on this topic can be found here and here, along with MBA President and CEO, Bob Broeksmit, CMB’s recent dissenting blog post explaining how and why rent control policies will perpetuate the housing supply-demand disconnect. MBA continues to lead industry stakeholder efforts to advocate against rent control – including (most recently) encouraging congressional Republicans to push back against this flawed policy – and for practical solutions to increase housing supply and address affordability needs.
