Housing affordability remains one of the single greatest sources of economic stress. Even if inflation measures were to come down, the simple cost of shelter is a huge burden on a wide swathe of the population. Hardly anyone disagrees with the idea of increasing supply, but this is easier said than done. There isn't a lot of spare construction capacity and the political fights over liberalizing zoning are tedious and slow. On this episode, we speak with Kevin Erdmann, a senior affiliated scholar at the Mercatus Center at George Mason University, who proposes a simple idea. He argues that after the Great Financial Crisis, regulators over-tightened lending standards, and in so doing, took out the entire "starter home" segment of the new housing market. He says that if Fannie and Freddie were to liberalize their lending standards, homebuilders would be incentivized to build more homes that cater to people with lower incomes and lower FICO scores, essentially re-creating a whole slice of the new home market that's disappeared over the last 15 years.

Read More:
US Homebuilders Face a Supply Chain Snarl From Tariff Battles
US Mortgage Rates Decline to 6.88%, Lowest Level This Year

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Housing affordability remains one of the single greatest sources of economic stress. Even if inflation measures were to come down, the simple cost of shelter is a huge burden on a wide swathe of the population. Hardly anyone disagrees with the idea of increasing supply, but this is easier said than done. There isn't a lot of spare construction capacity and the political fights over liberalizing zoning are tedious and slow. On this episode, we speak with Kevin Erdmann, a senior affiliated scholar at the Mercatus Center at George Mason University, who proposes a simple idea. He argues that after the Great Financial Crisis, regulators over-tightened lending standards, and in so doing, took out the entire "starter home" segment of the new housing market. He says that if Fannie and Freddie were to liberalize their lending standards, homebuilders would be incentivized to build more homes that cater to people with lower incomes and lower FICO scores, essentially re-creating a whole slice of the new home market that's disappeared over the last 15 years.
Read More: <a href="https://www.bloomb/?utm_medium=referral&amp;utm_source=podcast&amp;utm_campaign=odd_lots&amp;utm_content=articleerg.com/news/articles/2025-03-06/us-homebuilders-face-a-supply-chain-snarl-from-tariff-battles" data-testid="link-with-safety" data-renderer-mark="true">US Homebuilders Face a Supply Chain Snarl From Tariff Battles</a> <a href="https://www.bloomberg.com/news/articles/2025-02-26/us-mortgage-rates-decline-to-6-88-lowest-level-this-year?srnd=undefined?utm_medium=referral&amp;utm_source=podcast&amp;utm_campaign=odd_lots&amp;utm_content=article" data-testid="link-with-safety" data-renderer-mark="true">US Mortgage Rates Decline to 6.88%, Lowest Level This Year</a>
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Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.

Bloomberg's Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets and economics. Join the conversation every Monday and Thursday.

Bloomberg's Joe Weisenthal and Tracy Alloway analyze the weird patterns, the complex issues and the newest market crazes. Join the conversation every Tuesday and Thursday for interviews with the most interesting minds in finance, economics and markets.

Odd Lots

On Bloomberg’s Odd Lots podcast Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets, and economics. Join the conversation every Monday and Thursday. 

On Bloomberg’s Odd Lots podcast Joe Weisenthal and Tracy Alloway explore the most interesting topics in finance, markets, and economics. Join the conversation every Monday and Thursday.

Is There an Extremely Simple Fix for Affordable Housing?

https://api.omny.fm/orgs/e73c998e-6e60-432f-8610-ae210140c5b1/clips/4e9cb62d-ffac-41d5-97e7-b29e012be955/transcript

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