The markets went haywire as the White House began debates over Syria, causing investors to crawl back to U.S. debt instead of foreign investments.
When looking at the financial markets, housing makes up one of the major legs in the economic system, and mortgage experts are urging policymakers to move forward with housing finance reform before the end of 2013.
However, many are doubtful progress in this area will be made by year's end.
"It’s critically important that some of the momentum created in housing continues," argued David Berenbaum, chief program officer for the National Community Reinvestment Coalition.
He added, "We have new rules such as the Qualified Residential Mortgage standard, and these are casting sunshine on issues that have been trouble spots for the financial and real estate sector for quite some time. It would be extremely unfortunate if the White House failed to continue that momentum because of foreign affairs."
However, other analysts aren’t as convinced that Capitol Hill will put as much attention on mortgage finance reform during the remainder of the year.
Although the Protecting American Taxpayers and Homeowners Act (PATH) was being reviewed for floor action by the House Committee on Financial Services some time in September, it's likely to be pushed back to October, says Mark Calabria, director of financial regulation studies for the Cato Institute.
"With the exception of the Federal Reserve chair nomination, I don’t see the White House putting much energy into mortgage finance reform, so that doesn’t change," Calabria said.
He continued, "As nothing is out of committee in the Senate, I don’t think it changes the process there. The Senate Banking Committee will continue along its current timeline."
On a similar note, The Collingwood Group partner and managing director Tim Rood doesn’t foresee any legislation moving significantly until the next presidential election.
"There’s not enough oxygen in the room and there are too many other priorities that are happening to worry about the state of urgency around GSE reform," Rood noted.
He added, "At the end of the month we will find out if the MMI Fund (at the FHA) will need its first bailout, and I think it will be in the black and not require a draw, which will take less heat and attention off of housing reform."
Rood went on to explain that legislation is only passed in two ways: when everyone rallies around the bill because urgent change is needed or policymakers get so tired of addressing the issue that they pass the proposal to get it off their plates.
While the majority believes the housing crisis is old, regulators have only earnestly begun talking about housing reform over the past year or so.
"There’s bigger fish to fry," Rood said.
Nonetheless, the housing market is beginning to see a consensus among organizations and taxpayers that members of Congress need to take action and begin the process of providing affordable housing to everyone.
"People want stability to return to the marketplace because voters recognize housing as a major investment in their life time," Berenbaum said.
He concluded, "It’s an issue that crosses over party lines because people want to see the system fixed."
