I don’t know anyone in the mortgage or real estate business that doesn’t feel that we are totally over regulated. Over-regulated that it costs each consumer more money to buy a home and get a mortgage. That many of the regulations that are going to be part of Dodd-Frank haven’t even been written. That many of the upcoming regulations could stymie the housing market.
As part of Basel 3, banks and lenders will have additional capital reserve requirements, which will change the lending landscape yet again. If additional capital requirements become required many of the lenders that are doing mortgages today may not be able to comply, which means some will go out of business or merge. You might say, so what? The problem is less competition means higher costs.
None of this really bodes well for a housing recovery.