In unusually personal prepared remarks, David H. Stevens, President and CEO of the Mortgage Bankers Association (MBA) told members gathered at the association's Annual Convention and Expo in Boston that he has "been battling an aggressive, but treatable, cancer." He went on to equate the necessity to work with others to accomplish that treatment to the task MBA has to work together to reset the housing agenda.

A home is more than the American Dream, he said.  It is at the heart of every community and housing comprises about 18 percent of the gross domestic product, a steady source of hundreds of thousands of jobs, and it critical to the economic success of every single American. However, for the past 8 years the national housing policy has been shaped, not just by a crisis but a collapse.

"Considering the circumstances," he continued, "it was not unexpected for policymakers to act as they did."  They had little choice but to protect families and defend consumers and did so the only way they could; by taking more control, and using enforcement to hold accountable those perceived to have been at fault.

As to a reset, he said the upcoming election is an opportunity and pointed to four areas and strategies where MBA has the most credible voice and can lead.  The first is removing barriers to the expansion of credit toward both owner-occupants and rental finance.

Today the fear of a mistake, even one irrelevant to the credit decision, discourages lending to some first-time homebuyers "because of overly aggressive and sometimes inappropriate enforcement actions by some key government agencies." The regulatory framework is often redundant, with state regulations on top of federal regulations on top of international rules. This leads to the most conservative lending posture in order to meet the lowest common regulatory denominator.

There is a need to find the right balance between necessary enforcement, appropriate regulation, consumer protection, and lender risk. "Rules should be clear. Accountability should be rational. Credit, including private capital, must be accessible."

The second area is to create and promote affordable housing through incentives, like down payment savings and matching plans, and encouraging financing and building of affordable rental units near places of work and transportation.

While the economy is improving, housing is lagging and first-time homebuyers are lagging the most; about 25 percent below what is considered their normal share. The need for new incentives is illustrated by the delay in qualified millennials entering homeownership with a rate of only 34 percent, around half the national rate. But it is not only that they aren't buying; they aren't renting either.  One in three 18 to 34-year-olds still live with their parents, the first time since 1880 that more people in this age group live with Mom and Dad than in other living arrangements. 

Whether this is about tight credit, student loan debt, the lack of affordable housing stock, average wages for young people, or just that the generation is taking its time getting married or buying a home, it is causing an unusual and unsustainable rise in rental costs, particularly in urban areas.  Over the last 20 years the percentage of Americans dedicating at least half of their income to housing has risen from 42 percent to 52 percent. Over a million families dedicate over 70 percent of their income to pay rent and keep the lights on Stevens said.

He urged new ways to think about credit and documenting borrowers and the use of Low-Income Housing Tax credits and other programs to encourage the building and financing of more affordable rental and owned housing.

And once the first two are accomplished then the industry must find a way to communicate it.  The association has a powerful voice for housing and must start a dialogue that acknowledges the changes the industry has made, recognizes the unprecedented safety of the housing market, and, promotes confidence in the housing market.  To this end, MBA will unveil a new marketing plan in January emphasize the benefits of housing and the job lenders are doing.  "We will arm you," he said, "with the content you need to get the message across."

Finally, he called on the new President to create the position of a National Housing Policy Director.  "Someone who works in the White House. Someone with the authority of a direct report to the new President. Someone empowered to call meetings, drive results, and measure progress.  Someone who has not just the title, but also the teeth." This he said is not just a dream, it's the only way to untangle the confusion and imbalances, it's the only way to avoid another housing crisis.

Stevens concluded, "The bottom line is this: MBA is the most effective voice in housing finance, and we will use that voice.  As you know, we are not your average trade association. We have the size and scale, the expertise and resources, and we have the members to really make an impact. It's the power of our scope and unity that gives us the force behind our voice."