Archinect - News

Government is incentivizing development in areas vulnerable to climate change

2019-09-30T13:15:00-04:00

As the effects of climate change grow more apparent, the question of where to build is due to become a significantly more complicated affair.

A case in point comes from a recent report in The New York Times highlighting the ties between financing, land-use, and climate vulnerability.

The report delves into a paper studying the ways in which financial lenders are already shielding themselves from exposure to climate-vulnerable real estate investments by shifting risky mortgages over to the American federal government via institutions like Fannie Mae and Freddie Mac. According to The New York Times, because the two entities cannot include risk of natural disaster as part of their mortgage pricing strategy, the move effectively allows the mortgage companies to receive full-rate for investments that might otherwise be worth less than stated. According to the report, the increasing number of mortgages tied up held under this arrangement raises "troubling questions about who will bear th...

Trump Administration poised to reshape government's role in Fannie Mae, Freddie Mac

2019-08-30T19:15:00-04:00

The Trump administration and lawmakers in both parties generally don’t believe the government should be running in effect two enormous financial companies. Administration officials want to shrink the government’s involvement and return housing finance to a privately run system.

The Wall Street Journal takes a look at how (and why) the Trump Administration is looking to change the federal government's role in overseeing aspects of the nation's mortgage securities market.

According to WSJ, the two government-sponsored entities secure half of the nation’s $10 trillion mortgage market.

The return of redlining: how the mortgage industry is threatening Detroit's rejuvenation

2015-12-07T13:04:00-05:00

In Detroit, there were 3,500 sales of single-family homes in 2014. Only 462 of them received a mortgage. That means that nearly 87 percent of sales were in cash — and that doesn’t include homes sold in foreclosure auction. Comparatively, the overall metro area saw only 53 percent in cash sales the same year. Nationwide, it was 43 percent. “The number one issue that we, in the end, identified in Detroit is that it’s incredibly hard for homebuyers to get a mortgage right now,” say Svenja Gudell..

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