Susan Wachter

Susan Wachter appears in Can Trump make buying a home more affordable? as the economist explaining how mortgage-backed securities can affect mortgage rates. The source uses her to connect a government-backed bond-purchase announcement to lower mortgage rates, while keeping the estimated effect small and vulnerable to other macro and geopolitical forces.

Her main contribution is the risk and supply caveat. She says rate relief can be real but modest, that mortgage rates can move again when other events alter market expectations, and that taxpayers take on interest-rate risk when Fannie Mae and Freddie Mac buy more mortgage-backed securities. She also argues that Housing Affordability Supply Mechanics ultimately requires building more homes, especially starter homes, rather than relying only on demand-side support.

Connections

• Mortgage-Backed Securities Rate Policy - mechanism she explains.
• Demand-Side Housing Affordability Policy - category she limits.
• Fannie Mae and Freddie Mac - government-backed institutions in the risk channel.
• Housing Affordability Supply Mechanics - supply-side conclusion she reinforces.