How two new government policies could help make housing more affordable in Nashville

Housing stakeholders in Nashville hope two new policies — one at the federal level and another at the local level — play at least small parts in making homeownership more affordable and accessible.

Why it matters: No single policy will magically solve the city's affordability crisis, but every drop in the bucket helps. Experts say the new policies could especially benefit new homeowners.

Driving the news: The Federal Housing and Finance Administration announced a new policy allowing lenders to factor in a prospective homebuyer's rent payment history when approving a mortgage application.

• Up to this point, lenders used the FICO system, which considers a borrower's credit card and loan history when calculating their creditworthiness.
• Experts say the old system gave FICO a monopoly, and that adding in the new VantageScore credit score option creates competition that should lower fees for borrowers.

The big picture: National Realtors Association chief advocacy officer Shannon McGahn applauded the policy shift, saying it "better reflects how today's consumers manage their finances."

• FHFA director Bill Pulte took a victory lap after the announcement and credited President Trump for the policy change. He says the competition will help homeowners.
• The policy will take some time to be implemented as FHFA works out administrative details.

What she's saying: Christi Wedig, a loan originator with CMG Home Loans, tells Axios the FHFA policy switch should help borrowers like young people and immigrants who haven't taken out a loan or a credit card.

• "I think it's going to be really helpful across the country, and particularly here in Nashville," she says. "Rent is not cheap here. If you're paying $2,500 to $3,000 a month, you deserve some impact on your credit score."

Yes, but: There are also risks since a single missed payment for a utility bill or rent didn't impact a person's credit score in the past. There's also the question of whether a landlord reports successful rent payments to VantageScore, something a local mom and pop landlord may not do.

• Wedig says it's important renters make sure their payments are verifiable through transaction history such as checks, electronic transfers or Venmo.

• Renters can register their own payment history through third-party companies to boost their VantageScore rating, although that service typically costs money.

Metro approves new multi-family construction rule

Zoom in: At the local level, Metro Council passed legislation last week that updates codes regulations to allow a multi-family building to be constructed with a single staircase. The policy applies to buildings up to six stories.

• Homebuilders say the policy will significantly lower their costs, which should benefit both renters and condo buyers.

Between the lines: Advocates, such as Metro Councilmember Rollin Horton, say the single-stair design is cost effective and "just as, or even more safe" for residents.

• The state passed enabling legislation allowing local governments to implement the new code. Council members collaborated with the Fire Marshal's office, Codes Department and Planning Department to create the policy.

The bottom line: "This law reduces the cost of building family-sized apartments and condos that will help us meet Nashville's middle class housing needs," Horton said.