Congressional Budget Office

Supporting the congress since 1975

Congressional Budget Office

contact cbo

  • home
  • about
  • topics
  • cost estimates
  • my cbo

Housing

The federal government plays a substantial role in the housing market. Fannie Mae and Freddie Mac purchase and guarantee loans from banks and other lenders, and the Federal Housing Administration and some other agencies increase the availability of mortgages by assuming most of the risk of default on loans to eligible home buyers. In addition, the federal tax code encourages home ownership by allowing deductions of mortgage interest and property taxes and excluding most capital gains from taxation when a home is sold. CBO's work (including its analysis of Fannie Mae and Freddie Mac) assesses the effects of those policies and the impact of legislative proposals regarding the housing market.

Sub-Topics:

  • Housing Market Crisis

monthly archive

  • May 2013 (2)
  • April 2013 (14)
  • March 2013 (22)
  • February 2013 (10)
  • January 2013 (11)
  • December 2012 (4)
  • November 2012 (10)
  • October 2012 (4)
  • September 2012 (6)
  • August 2012 (5)
  • July 2012 (11)
  • June 2012 (8)
browse all
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

CBO Releases Report on the Troubled Asset Relief Program—March 2012

blog post

March 28, 2012


  • Supplemental Material

  • Blog Post

related publications


  • TARP—March 2012

    March 28, 2012
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

Report on the Troubled Asset Relief Program: Infographic

image

March 28, 2012

read complete document  (png, 236 kb)

  • Supplemental Material

  • Blog Post

related publications


  • TARP infographic

    March 28, 2012
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

Report on the Troubled Asset Relief Program—March 2012

report

March 28, 2012

read complete document  (pdf, 186 kb)

Highlights

In October 2008, the Emergency Economic Stabilization Act of 2008 (Division A of Public Law 110-343) established the Troubled Asset Relief Program (TARP) to enable the Department of the Treasury to promote stability in financial markets through the purchase and guarantee of "troubled assets." Section 202 of that legislation requires the Office of Management and Budget (OMB) to submit semiannual reports on the costs of the Treasury’s purchases and guarantees of troubled assets. The law also requires the Congressional Budget Office (CBO) to prepare an assessment of each OMB report within 45 days of its issuance. That assessment must discuss three elements:

  • The costs of purchases and guarantees of troubled assets,
  • The information and valuation methods used to calculate those costs, and
  • The impact on the federal budget deficit and debt.

To fulfill its statutory requirement, CBO has prepared this report on transactions completed, outstanding, and anticipated under the TARP as of February 22, 2012. By CBO’s estimate, $431 billion of the initially authorized $700 billion will be disbursed through the TARP, and the cost to the federal government of the TARP’s transactions (also referred to as the subsidy cost), including grants for mortgage programs that have not yet been made, will amount to $32 billion.

The estimated cost of the TARP stems largely from assistance to American International Group (AIG), aid to the automotive industry, and grant programs aimed at avoiding foreclosures. Other transactions with financial institutions will, taken together, yield a net gain to the federal government, in CBO’s estimation.

CBO’s current assessment of the cost of the TARP’s transactions is $2 billion lower than the $34 billion estimate shown in the agency’s previous report on the TARP (issued in December 2011). That decrease in the estimated cost stems primarily from an increase in the market value of the government’s investments in AIG and General Motors (GM), partially offset by added costs resulting from new initiatives in the Treasury’s mortgage programs. CBO’s current estimate for all TARP transactions is less than OMB’s latest estimate of $68 billion, largely because CBO projects a lower cost for the mortgage programs.

When the TARP was created, the U.S. financial system was in a precarious condition, and the transactions envisioned and ultimately undertaken engendered substantial financial risk for the federal government. Nevertheless, the net costs directly associated with the TARP, when taken in isolation, have been toward the low end of the range of possible outcomes anticipated when the program was launched—in part because funds invested, loaned, or granted to participating institutions through the Federal Reserve and government programs other than the TARP helped limit those costs.



  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

H.R. 2779, A bill to exempt inter-affiliate swaps from certain regulatory requirements put in place by the Dodd-Frank Wall Street Reform and Consumer Protection Act

cost estimate

February 6, 2012

read complete document  (pdf, 20 kb)

  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

Revisiting the Excise Tax Effects of the Property Tax

working paper

February 2, 2012

read complete document  (pdf, 345 kb)

Abstract

This paper analyzes the excise tax effects of a general property tax from the perspective of a small open economy facing a perfectly elastic supply of capital, focusing on the mix of forward tax-shifting to consumers and backward tax-shifting to labor and landowners. The model utilized differs from most that have appeared in the property tax literature as follows:

  1. the property tax is applied in a four-sector model with three taxed sectors—manufacturing which produces a tradable good, housing and services which produce nontradable goods, and a tax-exempt agricultural sector that produces tradable goods;
  2. the analysis considers an “intermediate run” time frame in which labor is partially mobile (perfectly mobile across production sectors but fixed in total supply within the taxing jurisdiction), while land is fixed in each production sector; and
  3. all production sectors use capital, labor and land. Within the context of this model, the excise tax effects of the property tax are borne primarily by labor and land.

    4. This result is in marked contrast to that obtained using a four-sector analog of the “traditional view” of the property tax with immobile labor, under which the excise tax effects are borne by consumers and there is clear and significant over-shifting of the tax to the consumers of nontradable goods. This result is robust to sensitivity analyses with respect to the parameters used in the simulations of the model. Our results also suggest that the degree of backward tax-shifting declines markedly in a longer run time frame where labor is perfectly mobile across jurisdictions.


  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

An Evaluation of Large-Scale Mortgage Refinancing Programs

working paper

September 1, 2011

read complete document  (pdf, 453 kb)

monthly archive

  • May 2013 (2)
  • April 2013 (14)
  • March 2013 (22)
  • February 2013 (10)
  • January 2013 (11)
  • December 2012 (4)
  • November 2012 (10)
  • October 2012 (4)
  • September 2012 (6)
  • August 2012 (5)
  • July 2012 (11)
  • June 2012 (8)
browse all
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

CBO Testified on Several Topics Related to the Government's Mortgage Programs

blog post

June 2, 2011


  • blog post
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

The Budgetary Cost of Fannie Mae and Freddie Mac and Options for the Future Federal Role in the Secondary Mortgage Market

report

June 2, 2011

read complete document  (pdf, 0 kb)

monthly archive

  • May 2013 (2)
  • April 2013 (14)
  • March 2013 (22)
  • February 2013 (10)
  • January 2013 (11)
  • December 2012 (4)
  • November 2012 (10)
  • October 2012 (4)
  • September 2012 (6)
  • August 2012 (5)
  • July 2012 (11)
  • June 2012 (8)
browse all
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

Accounting for FHA's Single-Family Mortgage Insurance Program on a Fair-Value Basis

blog post

May 18, 2011


  • blog post
  • Sign Up For CBO Emails
  • Sign up for All CBO RSS Feeds

Accounting for FHA's Single-Family Mortgage Insurance Program on a Fair-Value Basis

report

May 18, 2011

read complete document  (pdf,  kb)

  • « first
  • ‹ previous
  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • …
  • next ›
  • last »
  • about
  • topics
  • cost estimates
  • my cbo
  • press
  • privacy, security, and copyright policies
  • our business opportunities
  • sitemap

work at cbo

learn more about working at cbo and check out the agency’s career opportunities

stay connected

get cbo’s email updates