- Jonathan Poyer
The Omnibus Bill and Housing
Let’s look under the hood of the new omnibus bill for a second, as it relates to housing. Just taking a peek at a few things that stood out:
“New commitments to guarantee single family loans insured under the Mutual Mortgage Insurance Fund”
“New commitments to guarantee loans insured under the General and Special Risk Insurance Funds”
“New commitments to issue guarantees to carry out the purposes of section 306 of the National Housing Act”
That is a total of $1.33T (that is $1,330 with another 9!!! zeroes) to guarantee mortgage loans.
The Agency MBS market is $5.5T
The total value of private residential real estate is around $43T
Fun times with math:
A stack of a trillion dollars would reach 1/4th the way to the moon (it's true)
One trillion seconds equals 32,000 years
One trillion mm = going around the world 25 times…almost as wide as the sun
In short: there are backstops holding up the mortgage market.