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Research Publication

The Return of Private Capital

October 4, 2014


In the wake of the housing crisis, there has been much focus on private capital and its role in the mortgage market, as policymakers and market experts have called for greater private capital investment in the market.

In this edition of Housing Insights, Fannie Mae’s Economic & Strategic Research Group examines the level of private capital participation in the mortgage market following the financial and housing crisis. There is a common perception that private capital has exited the mortgage finance market. Although the decline has been real and significant, we find that private market participants remain a significant source of liquidity to the U.S. mortgage market. However, although private capital investment in newly originated mortgage credit risk has increased since the financial crisis, it must increase further to reverse the continuing decline in private share of credit risk on mortgage debt outstanding.

To learn more about these findings, read our latest Housing Insights.

The Return of Private Capital (PDF)