A Guggenheim Executive's Radical Plan to Build Millions of New Homes | Odd Lots

According to numerous estimates, the US is massively short of housing. Zillow, for instance, says America needs to build 4.5 million new homes to climb out of this deficit. But right now we're not coming anywhere near to closing that gap. And in fact, the efforts by the Federal Reserve to tame inflation have likely made things worse, with higher interest rates slowing the construction of multi-family dwellings. So is there a way to create more homes, even in a time of high rates? In this episode, we speak with Jim Millstein, co-chair of Guggenheim Securities and a former Treasury Department official who managed the restructuring of AIG after the 2008 financial crisis. Millstein has drawn up a plan whereby Fannie Mae and Freddy Mac can enter the market for construction finance and re-start it. He walks us through how — with their existing legal authority — these two entities could make hundreds of thousands of new affordable homes come to the market each year.

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A Guggenheim Executive’s Big Plan to Build Millions of New Homes

A potentially powerful new role for Fannie and Freddie.

Jim Millstein, the Guggenheim Securities co-chair and former US Treasury official, has a plan to build millions of additional homes in America.

In an interview on the Odd Lots podcast, Millstein lays out a new approach that leverages the unique capacity of the government-sponsored enterprises (GSEs) known as Fannie Mae and Freddie Mac, to jumpstart the production of affordable apartments and other multifamily projects.

At issue, he says, is the evolution of the US housing market in the aftermath of the financial crisis and the impact of higher interest rates at a time when the Federal Reserve is still trying to tamp down inflation.

Read moreA Guggenheim Executive’s Big Plan to Build Millions of New Homes

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