Good morning.

Thank you to the National Association of Realtors for inviting me to join you at today's National Summit on Housing Opportunities. And thank you for your generous introduction, Cathy. Under Cathy's leadership, the Realtors are a driving force in helping millions of families realize the American Dream of homeownership. HUD's partnership with NAR is having a powerful impact on this nation, and I want you to know that I appreciate our work together.

I am honored to be here with so many respected leaders in the housing field. If we are to successfully meet the challenge ahead of us and remove the barriers to affordable housing in America, your participation is critical.

It is good to see Senator Allard here this morning. The Senator is a strong ally as Chairman of the Banking Committee's Housing and Transportation Subcommittee. The Senator introduced the President's American Dream Downpayment Initiative and is very effectively guiding it through the Senate. I want to thank him for that.

Congressman Bob Ney has brought exceptional leadership to the House Financial Services Subcommittee on Housing. I appreciate his successful efforts to pass the American Dream legislation in his subcommittee. Thank you for being here, Congressman.

Senator Carper and Representative Frank, welcome. Both of you are strong advocates for affordable housing, and I am glad to see you here.

I am also very pleased that John Weicher, FHA Commissioner and my Assistant Secretary for Housing, has joined us to share his extensive expertise.

Many of today's roundtable guests are working closely with HUD to create affordable housing. NAR is a charter member of the Blueprint for the American Dream Partnership, which HUD created last year after President Bush challenged the housing industry to create 5.5 million new minority homeowners this decade. NAR members are working closely with us to meet the President's goal, and I welcome your efforts - along with the efforts of the many others here who are on the front lines in providing affordable homes for America's families.

I can report that we are making progress.

In the year since the creation of the Blueprint Partnership, the number of minority homeowners increased by 809,000, which is nearly as much as the two previous years combined. This puts us well on our way to meeting the President's goal of significantly increasing minority homeownership.

In addition to our work with the Blueprint Partnership, the Administration has proposed a number of new and expanded programs that will make affordable housing accessible to lower-income Americans. With the fiscal year coming to a close and many of these proposals rapidly moving through Congress, I want to update you on the latest news.

After months of hard work by the Administration, our supporters in Congress, and those of you who have been actively championing it on the Hill, the House of Representatives is now poised to take up and pass the President's American Dream Downpayment legislation.

The bill would authorize $400 million over two years to help families overcome the greatest barrier to homeownership: the high cost of closing on a home. In the Senate, appropriators have provided one year of funding at $50 million, which marks the first time the Senate has funded the American Dream Downpayment legislation. The Senate Banking Committee is moving toward action on the bill as well.

Our proposal has broad, bipartisan support in Congress, with more than 100 cosponsors. As the legislative process moves forward, we will continue to press for a level of funding that offers down payment assistance to the greatest possible number of families.

Housing education for minorities is another priority, and we have increased the budget for homeownership counseling services. The President requested $45 million for HUD's housing education program; the full House agreed to $40 million, and the Senate Appropriations Committee followed suit.

I encourage Congress to fund the Self-Help Homeownership Opportunity Program at $65 million, as we have proposed. This would triple SHOP funds and spur the construction of more than 5,000 new homes.

Congress has yet to match our request, but if Members were to spend some time talking with Millard and hear his enthusiasm for SHOP, I think we could quickly get them on board. I know how important the SHOP program is to Habitat for Humanity and other community organizations that are working to turn low-income Americans into homeowners.

Both the House and Senate have funded the very successful HOME Investment Partnerships program at just under $2 billion next year. The Administration requested a record level of funding for HOME in our fiscal year 2004 budget; the funding provided by Congress is only slightly below that.

Overall, we are making good progress in moving these important initiatives toward passage. I appreciate the support of Congress and the energy that so many of you have brought to our efforts. But obviously, more needs to be done.

In spite of overwhelming need, very few single-family homes are being built today in lower-income neighborhoods. The most common reason is that the cost of developing such housing in an economically distressed area would exceed the property's market value.

Our Administration has a solution for that, and this is where I need your help.

As you know, Congress has failed to take action during this session on a key proposal that would have a dramatic impact on the affordable housing supply. The President's Single-Family Affordable Housing Tax Credit would encourage the development of homes in neighborhoods where affordable housing is scarce. Over the next five years, it would provide developers nearly $2.4 billion in tax credits for building single-family housing in distressed areas. These credits would make 200,000 new homes available to low-income families.

The tax credit is a Treasury Department initiative that obviously has a tremendous impact on our work at HUD. Unfortunately, this key element in the President's affordable housing agenda appears to be going nowhere this year.

Over the course of the next year, I intend to fight hard for its enactment. I am asking you to fight with me.

I want you to join me in pressing Congress to enact the tax credit into law. We have heard the calls from affordable housing advocates for tax incentives that will encourage more production in our communities. We have listened, and the Administration has delivered. And now I am asking for your help in return.

Let's pass the Single Family Affordable Housing Tax Credit next year!

Our Administration believes that the federal government can play a role in boosting the supply of affordable housing by helping to bridge the gap between the cost of development and the value of single-family homes. The HOME program, for example, is one of HUD's most effective tools for helping communities meet housing-affordability needs.

But due to a maze of exclusionary, discriminatory, and unnecessary state and local regulations on developers and builders, many markets can no longer meet the demand for affordable housing. And many Americans are being priced out of a home.

Removing these regulatory barriers is key to meeting the housing needs of the nation's families. Once the barriers have been dismantled, experts say that development costs will drop by as much as 35 percent - which means that millions of Americans will be able to buy or rent housing that they cannot afford today.

HUD is addressing the regulatory problem on two fronts.

In May of this year, we launched a Department-wide effort called America's Affordable Communities Initiative. Our plan is to work in partnership with state and local governments to help them identify and reduce barriers that prevent the construction of affordable housing or drive up its costs.

Our second initiative is the Regulatory Barriers Clearinghouse, which we created in June of 2002. This web-based forum offers builders and developers nationwide the ability to share ideas and solutions for overcoming state and local regulatory barriers.

Sharing this kind of information will make it possible to put the lessons learned in one part of the country to work in another so that we can begin tearing these regulatory barriers down.

I want to talk about two issues that I know the industry has been following very closely: the Administration's proposal for reforming regulatory oversight of the housing government-sponsored enterprises, and RESPA reform.

Two weeks ago, in testimony before the House Financial Services Committee, Treasury Secretary Snow and I had the opportunity to outline the principles the Administration supports regarding regulation of the GSEs. We are in full agreement; Congress and the Administration have an opportunity and an obligation to strengthen the regulatory structure of the GSEs. A strong regulator is in everyone's best interests - the Administration, Congress, Wall Street, investors worldwide, and most importantly, the American taxpayer.

It is important to emphasize that Fannie Mae and Freddie Mac are an integral part of making the U.S. housing finance system the envy of the world. They help bring the world capital markets to America's front doors. Their efforts lift families all across this nation into homes of their own. As charter members of the Blueprint for the American Dream Partnership, Fannie and Freddie are working very closely with the Administration to help boost minority homeownership, investing hundreds of billions of dollars apiece. I am grateful for their active and willing involvement.

The Administration has a dual goal. We must ensure that, through the GSEs, financing is available for low- and moderate-income families. And we must ensure that the GSEs are subject to rigorous oversight, so that they are serving their valuable public purpose.

The Administration supports strengthening the powers of the GSEs' regulator. We support consolidating safety and soundness in a single regulator, instead of splitting them between two offices, as they are today. And we consider it appropriate to transfer authority over new program approval from HUD to a new, strengthened regulator, with an important consultancy role for HUD.

At the same time, the Administration proposal leaves the housing goals at HUD, which is where they belong. Providing affordable housing is a core element of the GSEs' charter, and only HUD has the expertise to develop and enforce the housing goals.

We agree that HUD's authority should be expanded by creating a new GSE Housing Office within HUD. This new office would be independently funded by the GSEs and responsible for establishing, maintaining, and enforcing the housing goals. The Administration wants HUD's oversight strengthened in additional ways to ensure that creating homeownership opportunities for low- and moderate-income families remains a top priority at Fannie Mae and Freddie Mac - as mandated in their public charter.

Turning to RESPA, as all of you know, HUD is in the process of revising our regulations. I want to applaud Cathy Whatley, her leadership team, and the NAR staff for their work on this, and for the thoughtful, helpful, and insightful comments that NAR and all our stakeholders have provided. We have listened carefully to what you have said about our plans, and our rule has evolved as a result of your comments. We are committed to issuing a new rule fully mindful of the impacts on small businesses.

I cannot say yet what form the new rule will take, or give you an exact timetable on when it will be published, but I can tell you that the mortgage finance process will be improved as a result. My goal from day one has been to establish better and timelier disclosure for consumers, so they have the opportunity to shop for the best loan, to simplify the mortgage origination process and eliminate the confusion, and ultimately, to lower settlement costs for homebuyers.

During the past three years of economic uncertainty, Americans continued to buy and refinance homes - in record numbers. The housing market has been a source of economic strength and stability, and every American has benefited as a result. You can be very proud of the fact that your work and your contributions are having such a tremendous impact.

We share a common mission in wanting to extend this prosperity to every neighborhood in every corner of the nation. The affordability problem is a challenge that we face together, and solving it will demand the combined talents and resources of federal, state, and local governments, the housing industry, the business sector, and nonprofits. I know that we can do more through our partnership, and I look forward to working with you to turn the affordable housing challenge of today into one of the great success stories of this generation.

Thank you.

Content Archived: March 16, 2010