In a way, government has subsidized housing for almost all Americans. Now after learning from the housing boom and bust, there are second thoughts about the consequences of this. Right now government backed mortgages represent almost all home loans.
Even today, private capital has not yet fully returned to this market,” Jeffrey Goldstein, the Treasury Department’s undersecretary for domestic finance, wrote recently. “Fannie Mae, Freddie Mac and other government entities guarantee more than 90% of newly originated mortgages. They are practically the only game in town.” (In 2005, they accounted for just a third of the market.)
via Feds rethink policies that encourage home ownership – USATODAY.com.
