How The Banking Reform Will Influence Florida Realestate

Dated: 03/27/2018

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According to the National Association of Realtors (NAR), Florida has experienced a strong economic and employment growth after the Hurricane Irma, the post-Maria influx from Puerto Rico, the recent tax reform bill out of Washington among other developments. While this may seem counterintuitive, the NAR has some solid arguments to back their observation. Recently, a banking reform bill called the Regulatory Relief and Consumer Protection Act, S, 2155, was taken up by the Senate. Amidst a lot of speculation, the NAR is claiming that this bill will be beneficial to the real-estate industry in general. Potential homeowners  who are struggling to receive mortgages because they haven’t yet build a semblance of a normal credit history may be able to get some relief as a result of this reform. This reform balances consumer protection with changes that could make the home buying procedure easy and quickly available to the people who need it. Easing up on such regulations could stand to boost the real estate market in Florida as more young people will finally be able to invest in local property.


Currently, the main source of home mortgage financing in rural areas includes community banks that are themselves struggling. However, the lowered burdens on credit unions and community banks will in-turn make home lending more easily available to people who need it. The new bill balances financial regulation with consumer protection, resulting in expanded credit score models, streamlining of the credit process and minimizing regulatory burdens on credit unions and smaller community banks. In Fact, the nation’s largest players in the home mortgage funds market including Fannie Mae and Freddie Mac’s will be required to accept rent and utility payment history as part of loan applicants’ credit scores.


Additionally, Property Assessed Clean Energy (PACE) loans that are used by homeowners to make their property energy-efficient used to be problematic as they were considered first-lien and clashed with mortgage loans. With the proposed bill reforms, more emphasis is laid on making the PACE loans accountable and access to manufactured housing is improved.


Since the House has already passed its version of the banking reform, if Senate approves the reforms, both bills will have to be reconciled. The NAR has been advocating balanced financial regulation and appropriate consumer protection for a long time so this reform will be a welcome change to create a vibrant housing market and improve the overall economy if it gets implemented.


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Rosa DeCarlo

Rosa DeCarlo was born in raised in sunny South Florida. Growing up in Miami and the in the tri county area, Rosa has gained vast knowledge about these surrounding locations. From where the grade A s....

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