When lawmakers come back to Washington early next year to tackle the country's housing crisis, they will argue over various proposals to fix affordability, high mortgage rates and the lack of inventory. They will debate ideas such as gifting $25,000 to first-time homebuyers, cutting regulation costs and releasing millions of acres of federal land.

But Mark Milam, a mortgage banker and loan originator in Atlanta, says those proposals are like “swallowing an aspirin next year for a headache you have now.”

Demand is not the problem, nor is it a lack of home builders, he wrote in a LinkedIn essay this summer. (An updated version of the piece was also posted on HousingWire this fall.)

“As an owner of a mortgage company and a 20-year housing veteran,” he wrote, “I can tell you there’s no shortage of people who want to buy, just as there is no shortage of builders who want to build.”

Milam has a three-point plan to address the housing crisis. It won’t cost the government one red cent; in fact, it may increase Uncle Sam’s revenue and perhaps even help cut the deficit. The trouble is, it isn’t particularly sexy, it can’t be reduced to sound bites and it isn’t easy to explain.

Like a voice in the wilderness, Milam doesn’t know how to get his plan before the powers that be in Washington. He tickled my interest when we ran into each other at an industry conference in Denver. His plan sounded plausible, so I told him I’d give it some ink.

The first plank of his plan involves the lack of inventory. While the number of houses for sale has been ticking up recently, there still aren’t enough to go around, and definitely not enough to outpace demand and reduce prices.

To boost inventory, Milam would temporarily halve the capital gains tax on the sale of investment properties. This one step, he believes, would untether millions of houses held by small-time investors.

According to BankRate, investors own more than 20 million single-family properties in the U.S. “That’s a lot of front doors,” Milam wrote, and most of them are owned not by Wall Street hedge-fund types, but by smaller “mom-and-pop” operations. These individual investors have owned their rentals for years, but are now getting a little long in the tooth. Many would presumably like to cash in and enjoy their later years free of any landlord obligations.

So, Milam asks, what if the capital gains tax on the sale of investment properties was cut in half -- even just for six months? During that window, if you would normally pay 20% based on your tax bracket, you’d pay just 10%, for example.

Milam calls this "a huge win-win-win" for the country, investors and homebuyers. The country would receive tax revenue it wouldn’t otherwise, investors would save big money upon selling highly appreciated assets, and homebuyers would have more properties to choose from, likely bringing prices down across the board.

Next, Milam would address lender profits. Currently, lenders lose money on the mortgages they write until the loans are on the books for roughly six months. But today’s buyers are impatient, jumping at the chance to refinance as soon as rates tumble even a tad. Consequently, lenders price their loans higher to compensate for the possible loss in revenue.

Milam says he’s sent packing more than one client who was planning to refinance as soon as possible because he would have ended up losing money on the deal.

“Guess what?” he wrote. “Lenders aren’t in business to lose.”

To prevent that, Milam would add a prepayment penalty -- he calls it a “premium recapture” -- that would fine a borrower for paying off their loan within, say, 12 months after closing. With that in place, he believes lenders would price their products lower, thereby increasing affordability for everyone.

Finally, Milam would attack loan-level price adjustments. Fannie Mae and Freddie Mac, under the oversight of the Federal Housing Finance Agency, require lenders to include these fees in their loans to account for risk. There’s a whole slew of variables involved -- the down payment amount, the length of the loan, the borrower's credit history, etc.

“In the 20 years I’ve been lending,” wrote Milam, these price adjustments have “expanded, worsened, expanded more and worsened more. They are cash cows for Fannie Mae and Freddie Mac.”

Here’s an example: Under the current regulations, a borrower with a credit score of 740 and a 20% down payment -- not a risky bet, as borrowers go -- is hit with a 0.875% price adjustment. If that charge were removed, the borrower's overall mortgage rate would drop by 0.875%, cutting the monthly payment on a $400,000 loan by more than $200 a month.

"Instant help with affordability," says Milam. Investors won’t make as much money per loan, but they’ll make it up on volume because more people will be able to afford financing.

Milam conceded his proposals may be drastic, but he contends that they would “have an immediate, positive impact on affordability.”

Men and women may be different in many ways, but not when it comes to selling their homes, according to a survey by marketing company 1000Watt. Sellers were asked to identify the most difficult part of the selling process, and the results were broken down by sex.

One notable difference: A third of the women polled said getting their places ready for sale was the most difficult thing, while only 23% of the men agreed. Some 27% of the men, on the other hand, said finding a trusted agent was the toughest part, compared with only 11% of the women.

On the other choices, though, the sexes were pretty much aligned: Determining the selling price was hardest for 8% of the men, 6% of the women; dealing with all the paperwork, 24% of the women, 21% of the men; negotiating with the buyer, 21% of the women, 16% of the men.

Are people losing interest in second homes? It appears so, according to the National Association of Home Builders, using the latest Census Bureau data.

In 2022, the latest year for which information is available, about 6.5 million second homes -- non-rental properties not classified as a taxpayer’s principal residence -- dotted the landscape. Those houses accounted for 4.6% of the national housing stock.

That’s a decline from 2020, when the number of second homes stood at 7.2 million.

"There were 807 counties spread over 50 states where second homes accounted for at least 10% of the local housing stock," reads the NAHB's Eye on Housing blog. And in some counties, second houses accounted for 50% or more of the total housing stock.

Less than a year: That’s how long it takes rookie buyers to find and purchase a house, according to a recent survey of 1,000 first-time buyers by New Jersey-based Provident Bank.

That time period fits in with the advice of real estate author and lender David Reed: “Take your time,” he posted on RealtyTimes.com.

Buying a home is "not to be taken lightly," Reed wrote. “Yes, it’s fun to shop for homes, but it’s not something to rush into. With a home, you can’t exactly go back to the sellers, show them your receipt and ask for a refund.”

If you start to feel rushed, perhaps you’re working with the wrong people. “No one should attempt to rush you into any decision,” Reed wrote. “After all, it’s you who’s going to be living there, paying the mortgage each month.”

Setting the right price is the key to selling quickly. If you don’t, the market will pass you by.

Your asking price is "your invitation to buyers," writes New York City agent Roberto Cabrera in a Brown Harris Stevens realty newsletter. “If you invite the wrong people, the wrong people will come.”

Set the price too low, of course, and you are not doing yourself any favors. But there are also pitfalls to setting it too high, which is the tendency of most sellers.

As Cabrera writes: "If you overprice, you’re inviting buyers who are looking at more expensive properties -- BETTER properties than yours. Meaning, yours will be the worst one they see."

Many people think manufactured houses, aka mobile homes, lose part of their value as soon as they roll off the sales lot, like automobiles do. That's not the case, according to a new sales price index.

Prices for factory-built houses jumped 7.9% for the 12-month period ending in June, per a new Federal Housing Finance Agency benchmark. The median price for manufactured houses at the end of that period was $231,000, making them one of the most affordable housing options available.

Meanwhile, shipments for manufactured houses declined in 2023 by 21% over the previous year, according to an analysis by the National Association of Home Builders. NAHB asserts that for every new factory-made house shipped last year, construction started on roughly 10 new site-built single-family houses.

Sometimes the bad guys get caught -- and pay a heavy price. For example, take the man who was sentenced earlier this month to more than 26 years in prison for conning homebuyers out of their down payments.

It seems the man, a Nigerian national recently living in the U.K., stole some $12 million from U.S. consumers and real estate companies by gaining unauthorized access to their accounts. Monitoring their emails to determine when a large transaction was about to be made, he intercepted the wire payment instructions, changed the information and resent the emails. The modified instructions directed the victims' funds to the con man's accounts.

After being extradited from England, he pleaded guilty to wire fraud affecting a financial institution and aggravated identity theft. In addition to the prison time, he has been ordered to pay $3.4 million in restitution. He will be subject to deportation after serving his sentence.

Just a few weeks into the aftermath of the class-action settlement that rocked the real estate world, sales commissions have shrunk. That’s the major finding of a recent survey of some 1,300 agents and brokers.

Earlier this year, a settlement was reached between the National Association of Realtors and disgruntled homebuyers in Illinois (and later Missouri) who believed they were forced to pay their agents too much. NAR is the politically powerful trade association for real estate agents and brokers.

The agreement prohibits listing agents from posting the buy-side agent’s share of the sales commission on local multiple listing services. One of the biggest fears among agents was that sales fees would drop significantly as a result.

“That worry may have been merited,” reads a report by real estate publishing company RISMedia, which conducted the survey. The company found that commissions have fallen by 68 basis points, or 0.68%. (The poll’s results are available only to RISMedia subscribers.)

Even though the settlement just took effect on Aug. 17, RISMedia calls the decline “very significant.” Indeed, in terms of dollars, 0.68% translates into a loss of $2,870 on a 6% commission on a median-priced house.

That’s $2,870 back into the pockets of the buyer or the seller -- or both.

Moving forward, it appears likely that commissions are poised to drop even further. Asked about their expectations, a slim 51% majority of respondents anticipated no change. But 37% anticipate further cuts, some of them “significant.” The remaining 12% think their fees will go back up.

The early decline appears to hit buy-side agents particularly hard, the survey found. These are the agents who bring buyers to the property -- and eventually, the closing table. On the buy-side, the decline was 0.37%, or $1,561 out of the agents’ pocket per transaction. Sellers’ agents took the remaining 0.31% hit.

That the decrease would come largely from the buy-side is pretty much what the pundits expected. Prior to the settlement, listing agents could advertise on the MLS what share of their fees they would be willing to pay to buy-side agents. But the plaintiffs argued that since the listing agent set the buy-side agent’s fee, they were effectively barred from negotiating a lower share.

Now, listing agents can still post commission splits on their own websites or those of their companies. But not on the MLS, which is where most people -- including agents themselves -- search for houses for sale.

Less experienced agents have been hit hard as well, according to the survey.

Prior to Aug. 17, buy-side agents with less than three years on the job were paid 2.58% of the sales price on average as their share of the commission. Post-Aug. 17, their share has dipped to 1.82%, which translates to a pay cut of $3,027 per median-priced transaction. Meanwhile, veteran buy-side agents saw only a 0.1% drop, from 2.68% to 2.58% -- losing only $422 per deal on average.

While many factors are at play for the downward shift, the survey says, “it is reasonable to assume that (buyers) are negotiating real estate fees downward when the money is coming directly out of their pockets.”

On the seller’s side of the equation, the average listing commission of an inexperienced agent fell from 2.98% to 2.41% -- more than half a point. Agents with 10 or more years' experience selling houses took a larger pay cut than buy-side agents with the same tenure, with their fees falling from 3% to 2.74%.

The report called it “extremely telling” that an agent's experience level appears to be the single most important factor in whether a deal includes cooperative compensation.

RISMedia also asked agents and brokers about a policy NAR still clings to, which allows listing agents to offer part of their compensation to the buy-side agent. Many in the industry argue that sellers have a strong motivation to pay the agents who bring buyers to the table, either directly or through their agents.

After all, as the survey points out, “attracting qualified buyers is the best way to get a good sales price and push through a complex, fraught sale process.”

But with compensation removed from the MLS, and consumers increasingly aware they don’t have to pay the other side’s agent, the data shows that cooperative compensation is on the wane.

Before the settlement, 91% of all transactions involved listing agents who paid the buy-side agents. After the settlement, only 77% did the same. While the business is still going through a period of adjustment, that 14-point drop is still “concerning,” the survey says.

Another change resulting from the legal settlement was that agents are now required to sign contracts with buyers before taking them to view any houses for sale. But the survey found that only 57% of the agents had complied so far.

It could be that many of those polled were not NAR members, and therefore not bound by the new rule. But it is safe to say a significant number are ignoring it.

As the report states, “enforcing the buyer agreement requirement is likely going to be a challenge going forward.”