Leading the Way for FHA, Fannie Mae & Freddie Mac Reform
CNU Officially Launches Initiative to Reform Restrictive Development RequirementsSubmitted on 07/12/2011. Tags for this image:
Over the course of the past six months, CNU has been leading the effort for federal housing finance reform. Working with our partners at the National Town Builders Association (NTBA), the National Association of Home Builders (NAHB), the National Association of Realtors, and the Center for Neighborhood Technology (CNT), CNU has been advocating for Fannie Mae, Freddie Mac, and HUD's 221d4 and 220 programs to raise and/or eliminate the restrictive covenants of commercial space in mixed-use developments.
Specifically FHA, Fannie Mae, Freddie Mac, and HUD's 221d4 and 220 programs all limit non-residential to a small percentage of the total value or imputed rent of a given project. (Fannie Mae currently sets the cap at 20%; Freddie Mac at 25%; and HUD's 221d4 and 220 programs at 15% and 30%, respectively.) As a result, these restrictions work against emerging demographic trends calling out for mixed-use settlement akin to traditional pre-World War II Main Streets. Oddly, by limiting financing to mixed-use developments, the federal remedy to the housing crisis has been to single out and prevent access to one of the few segments of the housing market in which demand is growing, while the worst performing and riskiest investments - single-use, sprawled-out areas at the metropolitan edge - are still preferentially classified.
As CNU CEO & President John Norquist states, "Federal housing finance rules have basically made Main Streets illegal in the United States. It's time to change the rules and let the market deliver good urban development."
CNU, along with its coalition partners, is excited to formally launch our FHA, Fannie Mae & Freddie Mac Reform Initiative, encouraging HUD and Treasury to relax or eliminate restrictions on housing adjacent or attached to non-residential development. By recognizing the latent demand for mixed-use hindered by the current restrictions in place, FHA, HUD, Fannie and Freddie have an opportunity to not only support smart-growth policies attuned to the goals of the HUD/USDOT/EPA Sustainability Partnership, but also help jumpstart much-needed economic growth.
See the FHA, Fannie Mae and Freddie Mac Reform page for further details, and stay tuned for more information on upcoming Reform Initiative meetings.