The U.S. Housing Finance Debacle, Measures to Assure its Non-recurrence, and Reform of the Housing GSEs

Ronald Spahr and Mark Sunderman

Journal of Real Estate Research, 2014, vol. 36, issue 1, 59-86

Abstract: We provide another perspective regarding Fannie Mae's and Freddie Mac's impact on the recent financial crisis. We conclude that the crisis and the GSEs being placed into conservancy were primarily caused by the proliferation of below prime mortgages, which led to their sustaining significantly higher default losses. We posit that the GSEs have unfairly served as scapegoats, whereas the crisis was largely caused by the proliferation of private label subprime mortgage instruments and by the U.S. Congress implementing social policies thru the GSEs without adequate default risk provisions. Our recommendations provide guidelines that may reduce the likelihood of a future similar crisis.

Date: 2014
References: Add references at CitEc
Citations:

Downloads: (external link)
http://hdl.handle.net/10.1080/10835547.2014.12091382 (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:taf:rjerxx:v:36:y:2014:i:1:p:59-86

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/rjer20

DOI: 10.1080/10835547.2014.12091382

Access Statistics for this article

Journal of Real Estate Research is currently edited by William Hardin and Michael Seiler

More articles in Journal of Real Estate Research from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().