As the housing market and U.S. economy change, so does FHA’s role in the housing finance market. In recent years, the housing crisis and economic recession pushed FHA to play an unprecedented role, and often stretch its resources, as private-sector sources of mortgage finance exited the market. The market downturn had substantial implications on the fund’s finances.
As policymakers prepare to address the future of the U.S. housing finance system, understanding FHA’s impact on homeownership accessibility, market stability, and the broader U.S. economy—as well as the factors that have influenced it—will be critical to determining its role in a future system. When has FHA been most and least effective? To what extent has it aided the housing market’s recovery? How should we interpret the agency’s current challenges as policymakers debate what comes after the conservatorship of Fannie and Freddie? A new analysis by HUD’s Office of Policy Development and Research will provide the backdrop for this discussion, analyzing the history of FHA, its importance to single-family housing finance, and its future role.
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