A bi-partisan group of former senators, Cabinet secretaries, and other housing and economic experts have released what is termed a new proposal for a housing finance system.  The report called Housing America's Future:  New Directions for National Policy was produced by the Bipartisan Policy Center's Housing Commission under a grant from the MacArthur Foundation.  It asks for a review of federal housing policy calling the current system outdated and not equipped to keep pace with today's demands and the challenges of the imminent future. Here is a partial summary of the Commission's recommendations.

The nation needs a responsible, sustainable approach to homeownership that will help ensure that all creditworthy households have access to homeownership and its considerable benefits.  It also needs a reformed system of housing finance with the private sector playing a far more prominent role in bearing credit risk while promoting greater diversity in mortgage funding sources. 

Federal policy should strike an appropriate balance between homeownership and rental subsidies.  This rebalancing would include winding down and ultimate elimination of the GSEs and a more targeted FHA restored to its traditional mission of primarily serving first-time homebuyers. 

The GSEs would be replaced by an independent government-owned corporation providing a limited catastrophic guarantee on qualified mortgage-backed securities (MBS); a reaffirmed commitment to providing a decent home for every American family; and a focus on providing help to those most in need.

Renters account for 35 percent of the U.S. population and their numbers are likely to grow significantly over the coming decade.  Pressure on the market may push rents further out of reach for low income households creating greater hardships for cost burdened renters. 

The plan calls for reforms that would establish a new performance-based system for delivering federal rental assistance with greater devolution of responsibilities to state and local providers. The commission also proposes to shift existing resources to assist more effectively the most vulnerable households, and to preserve and expand the Low Income Housing Tax Credit program to increase the supply of affordable rental housing.

The commission supports current approaches to the administration of housing support in rural areas delivered through USDA and suggests there be modest incremental funding for the Section 502 Direct Loan.

Finally the Commission said the country must address the overwhelming numbers of seniors who wish to "age in place" in their own homes and communities.  It recommends better coordination of federal programs that deliver housing and health care services to seniors including expansion of the Department of Energy's Weatherization Assistance Program to include home assessments and modifications for aging in place. Better guidance should be given to help seniors understand reverse mortgages and a White House conference could bring together key public and private players to draw national attention to the issue of senior housing and to catalyze development of a coordinated approach to aging in place.

The Housing Commission is co-chaired by former Senate Majority Leader George J. Mitchell, former Senator Christopher S. "Kit" Bond, former Senator and HUD Secretary Mel Martinez, and former HUD Secretary Henry Cisneros, and includes 17 other individuals from diverse professional and political backgrounds.

 "At this critical time in our nation's history, we can no longer afford to defer bipartisan action on housing," said the co-chairs in an op-ed in POLITICO today. "We believe our report can serve as a framework for Congress and the administration to act in the best interests of all Americans."

 "Six years after the collapse of the housing market, the problems in housing remain as severe as ever and solutions continue to be elusive," says the op-ed. "We hope [our report] will serve as a catalyst for action."