Capital Markets & Neighborhood Stabilization: Introducing the New Issue

Mark Calabria, the director of financial services regulation at the libertarian think tank Cato Institute, said recently that while “there are disagreements over the diagnosis of the [housing] problem, there are areas where people can come together and get a few things done.” His comments, spoken at this year’s annual National Community Reinvestment Coalition conference, were offered up on a panel that included ex-Fannie Mae CEO Franklin Raines, Diane Thompson, who has represented low-income homeowners and serves as counsel at the National Consumer Law Center, and Joe Smith, the former North Carolina banking commissioner who was appointed monitor for the recent attorneys general foreclosure settlement.

While a constructive working relationship between that panel’s members is yet to be seen, the new issue of Shelterforce, “Strange Bedfellows: Can Capital Markets Serve Neighborhood Stabilization?“ examines some of the real collaborations taking place on the ground between seemingly disparate actors and how those partnerships can translate into lasting stability.

In this issue “We look at the community development field as players in a marketplace who might have some points of commonality, or even partnership, with private equity firms, hedge funds investing in real estate, or for-profit developers scooping up foreclosed homes to turn to rentals,” writes Miriam Axel-Lute, Shelterforce editor.

Axel-Lute continues in her editor’s note:

As this capital enters our neighborhoods, it is time to not only organize, but to also step up and participate in the market, bringing our field’s strengths, connections, and know-how to make sure new investment doesn’t just wash further equity away from the places that have suffered the most. Though we come to the table as strangers (how often do you make deals with hedge funds?), we should do it not as supplicants, but as peers, and potential partnerships.”

So while collaborating on policy goals from 30,000 feet could surely tack a national narrative in a much-needed positive direction, many of these still-nascent collaborations could provide relief to communities hit hardest by this ongoing crisis.

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