Over-regulation a "disaster for Americans, especially first-time and low-income homebuyers."
Mortgage Bankers Association (MBA) chief executive Bob Broeksmit criticized the Biden administration's approach to housing policy in a speech in Washington, DC Wednesday.
The MBA president and CEO called for a drastic overhaul, proposing a "national housing policy director" to untangle the regulatory knots and bring order to what he described as "chaos."
“The administrative state is creating what I call “regulatory knots,” Broeksmit said in the speech. “As these knots grow, they restrict and even strangle businesses and consumers.
“To be clear, I’m not discussing mere over-regulation, which is a real problem. Rather, I’m advocating for regulatory clarity and consistency. We need to untangle the regulatory knot for the sake of the American people. They’re the real victims here, and as long as the knot exists and keeps getting tighter, it will sap our country’s economic strength.”
Broeksmit pointed to the Consumer Financial Protection Bureau's (CFPB) recent focus on "junk fees" as an example of regulatory overreach. He argued that the CFPB is targeting fees that are actually required by other federal agencies.
"It's mind-boggling," he said. "And it gets worse because the White House is in on the madness."
Another major concern is the proposed Basel III regulations, which he said would harm independent mortgage banks and make it harder for Americans to buy homes.
"Basel III will lead to higher prices on fewer mortgages," he warned. "That’s a disaster for Americans, especially first-time and low-income homebuyers."
To address the "regulatory knots" crisis, Broeksmit proposed establishing a national housing policy director in the White House, who would oversee all housing-related policies across agencies and resolve contradictory rules. This would help to ensure that regulations are consistent and do not conflict with each other, he argued.
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"This position would bring order to the chaos," Broeksmit said. "The director would oversee every policy that affects housing, no matter which agency it comes from. My proposal for a housing director is a basic matter of good government. It could be adopted for other industries."
Modeled on the role of director of national intelligence, the housing director would have a dedicated team with deep regulatory knowledge and authority to coordinate housing policies government-wide.
"We need this kind of streamlined, collaborative, and common-sense leadership when it comes to regulating the most important facets of our economy," Broeksmit stated. "The current approach is clearly failing."
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