New FHFA Director Warns of Vulnerability in Housing Finance System

In his first remarks as director of the Federal Housing Finance Agency, Mark Calabria today cautioned that “the foundations of our mortgage finance system remain vulnerable,” and highlighted the need for housing finance reform.

Calabria noted that while the market has seen strong house price growth over the past several years as a result of strong economic performance, “too many remain locked out of housing, while others are dangerously leveraged.” He added that making changes to the housing finance system now when the economy is strong is critical to ensure that it is prepared for another potential downturn. “Booms will eventually be followed by busts,” Calabria said. “It is during these moments we must prepare for the inevitable downturn.”