How Fannie Mae and Freddie Mac Can Help End the Housing Shortage

Christopher Goodney/Bloomberg
According to Zillow, the U.S. faces a significant housing shortage, with a need to construct 4.5 million new homes. Jim Millstein, co-chair of Guggenheim Securities, advocates for Fannie Mae and Freddie Mac (GSEs) to enter the construction finance market. He argues that establishing a secondary market for construction loans by the GSEs would inject much-needed liquidity into this sector. This increased liquidity, Millstein believes, would facilitate the financing and development of hundreds of thousands of new affordable homes annually, effectively tackling the housing shortage.