BiggerPockets Daily President Trump Confirms That He Will End Fannie and Freddie Government Conservatorship
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May 29, 2025 President Trump reveals plans to privatize Fannie Mae and Freddie Mac, marking a significant shift in the mortgage market. This move could reshape mortgage rates and housing affordability. Experts weigh in on the risks and rewards of this transition, particularly amid rising rates and falling home sales. The implications for investors are vast, with potential changes in lending practices and market volatility. This pivotal moment could redefine the landscape for real estate investors since the financial crisis.
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Trump's Fannie/Freddie Plan
- President Trump's plan involves taking Fannie Mae and Freddie Mac public but keeping government guarantees.
- This reverses 17 years of conservatorship while maintaining market stability and government oversight.
Government Guarantee Stabilizes Rates
- Maintaining government guarantees is crucial to stabilize mortgage rates and avoid market shocks.
- Without these guarantees, mortgage rates could jump 2%, severely harming housing affordability and transactions.
Wall Street Bets Big
- Wall Street investors, including hedge funds, have invested heavily in Fannie Mae and Freddie Mac stocks, expecting profitable privatization.
- This shows strong market anticipation despite regulatory complexities ahead.