In advance of the hearing, which was entitled "Prioritizing Fannie’s and Freddie’s Capital Over America’s Homeowners and Renters? A Review of the Federal Housing Finance Agency’s Response to the COVID-19 Pandemic,” the FHFA published Calabria's statement.
The (FHFA), Calabria said, "has acted swiftly and prudently to respond to COVID-19. Thanks in part to our efforts, the housing market has largely been a bright spot in the pandemic economic data. We continue to update our policies as the challenges facing renters, borrowers, and market participants evolve."
He began his testimony by outlining the agency's first response to the pandemic, which was transitioning its own staff to a virtual environment.
He went on to highlight the significant amount of data on trends in the housing and mortgage markets collected by the FHFA. Said data "enables the Agency to respond appropriately to market developments, promote market efficiency and stability, and disseminate information to improve the public’s understanding of housing finance markets," Calabria said. "Economic research and data analytics are core competencies of effective safety and soundness supervision, which is essential to preparing the Agency and the Enterprises to responsibly exit and operate safely outside of conservatorship. That is why, from the beginning of my term, one of my top priorities has been to strengthen FHFA’s research and data analysis capabilities."
Congresswoman Maxine Waters (D-California), FSC Chairwoman, also provided a statement in which she noted that, "short of a vaccine, our homes and the ability to shelter in place are the greatest protection we currently have against COVID-19." The hearing, she said, was important, for reasons including, that "the U.S. Census Pulse Survey recently found that 8.4 million homeowners and 8.2 million renters are behind on their rent and mortgage payments." (Her full statement is available here).
Calabria said the FHFA's top priorities have included "to support renters and homeowners struggling to pay for housing because of COVID-19."
To do this, Calabria said the Agency has directed the GSEs to put in place certain protections. "The Enterprises own or guarantee approximately $6.0 trillion in mortgages. That includes about 43% of multifamily units, about 8.6 million households, and more than half of single-family mortgages. FHFA’s policies apply to all single-family homeowners and multifamily property owners with an Enterprise-backed mortgage. FHFA’s policies also help to set workable standards for the entire market."
The FHFA he said has protected more than 28 million homeowners and enabled roughly 200,000 families facing foreclosure pre-COVID to stay in their homes.
"As a staffer on the Senate Banking Committee during the 2008 financial crisis," he said. "I saw firsthand the importance of resisting the pressure to “act first, analyze later” that arises in a period of financial stress. In a crisis, panic can lead to ill-conceived policy responses and send confounding signals to the market. It is imperative to remain calm and make decisions based on careful, thoughtful analysis of the most up-to-date data available."
The published statement includes charts, data, and further analysis. It can be accessed here.