How DOGE could shrink federal housing expenses

As the Trump Administration looks for cost savings at HUD and FHFA, they are learning that things that seem easy to achieve on the surface can be far more complex in practice. After the relatively easy task of headcount reductions, for example, the Trump team faces a morass of under-managed federal housing programs and subsidies at HUD that are not easy to unravel.

A major obstacle to finding savings at FHA and the GSEs is that credit costs are very understated thanks to soaring home prices. Even as the supply of unsold homes accumulates around the country, the averages for home prices in many markets continue to rise. There may appear to be a lot of capital inside FHA’s Mutual Mortgage Insurance (MMI)…