1st Dominion Realty

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Trulia on the pluses and minuses of Obama’s re-election

Posted: 09 Nov 2012 06:20 AM PST

Forbes has a column from Trulia’s chief economist, Jed Kolko, “What Obama’s Re-Election Means for Housing.” Interesting reading, but if you’re lazy here are the main points:

1. More opportunities for refinancing as the Obama Administration is expected to expand programs such as HAMP to more underwater homeowners.

2. New mortgage regulationsbecause Dodd-Frank isn’t going away. We’re still waiting to see how the Consumer Financial Protection Bureau will define “qualified mortgage” and “qualified residential mortgage” — and what effect that will have on lenders.

3. No changes to the mortgage interest deduction. Gov. Romney proposed capping itemized deductions at $25,000, effectively reducing the MID. (When it comes to the amount of mortgage interest per household, Virginia ranks #3 in the country and Washington, D.C., is #9.)

4. Less of a chance for principal reductions. Gov. Romney had called for principal reductions, but with protections for lenders if a home’s value appreciates. That would have been more palatable to the Federal Housing Finance Agency, which has refused to allow Fannie and Freddie to cut principal without such a clause, as the Obama Administration wants.