As prospective homebuyers struggle to navigate a housing market where prices continue to climb, an economic policy research group is offering four ways the federal government can ease the way.
Groundwork Collaborative issued a policy brief on Tuesday highlighting four ways the federal government can expand homeownership. The Washington, D.C.-based nonpartisan economic policy research firm is pushing for federal action at a time when elevated interest rates continue to be a reason limiting many buyers. The research team strives to share its findings and ideas with the goal of inspiring new legislation.
"Coming out of the pandemic, mortgage rates skyrocketed. This is encouraging folks to stay in their homes," said Emily DiVito, the group's senior adviser for economic policy. "That’s locking families out of homeownership, something considered a hallmark of the American dream."
The four strategies include:
- Allowing buyers to assume the seller's mortgage rate or transfer the one they have to a new residence after selling their home.
- Creating a mortgage system in which the federal government can lend directly to buyers.
- Having an agency such as the Consumer Financial Protection Bureau establish a national online database where mortgage products, fees, and terms would be publicly available and provide a one-stop shop for consumers to compare packages.
- Reducing mortgage insurance premiums, a change that would need to come from lenders.
Still, some strategies expose the government to more risk. Fannie Mae and Freddie Mac are government-controlled entities that set guidelines for the conventional loans they buy and package into securities that can be sold to investors. Both have been under federal conservatorship since the 2008 financial crisis, after the agencies took on toxic loans during the housing boom of the early 2000s.
DiVito said the federal government should take on a greater role, saying more exposure and visibility would be a good thing. "It has already served as an incredible backstop, but the role has been submerged in the private sector apparatus," DiVito said. "The consumer doesn’t know how much of a role the government plays.
At a time when the cost of living is skyrocketing, it’s a good thing to think of how the government could make the cost of living more affordable."The report comes at a time when housing continues to be part of the national narrative. President Donald Trump spoke about forthcoming reforms during his address to the nation on Wednesday.
Both the House and Senate presented massive housing-focused packages this year.
In October, the Senate passed the Renewing Opportunity in the American Dream to Housing, or ROAD, Act of 2025. The legislation includes dozens of housing-related initiatives, including boosts for transit-oriented developments, homebuyer assistance programs and modified lending standards that extend to manufactured housing. The bill is with the House.
Similarly, the House created its own housing-focused bill. The HOME Reform Act is a modification of the Home Investment Partnerships Program. It, too, focuses on streamlining the construction process and removing regulations. It has passed the House Financial Services Committee.