According to the BofA panel, most housing decisions still live and die at the local level, where zoning rules and “Not‑In‑My‑Backyard” resistance keep new supply from ever getting permitted.
Instead, supply proved “much less elastic than demand,” and home prices jumped more than 40% in about 18 months before a sharp rate shock locked would‑be sellers into ultra‑cheap mortgages. Existing‑home sales are now hovering around 4 million a year, which BofA notes is a roughly 40‑year low on a population‑adjusted basis, reflecting a frozen resale market and a “lock‑in effect” that could last six to eight years.
At the symposium, panelists said independent mortgage banks (IMBs) are “likely to retain dominance” in originations because Basel III capital rules and legal risk keep large banks from wading back in in a big way. GSE reform, another perennial talking point in Washington, remains uncertain and distant, making it a poor lever for near‑term affordability relief. In BofA’s view, focusing public anger on Wall Street or IMBs risks distracting from the harder, slower work of loosening land‑use rules and actually building more homes.
For this story, Fortune journalists used generative AI as a research tool. An editor verified the accuracy of the information before publishing.
