So says Joseph Gyourko.

I propose replacing FHA with a new subsidized savings program that provides matches of qualified households’ savings. The goal would be to help those households achieve a 10 percent down payment on the home they wish to purchase.

Of course, the interest groups that benefit from the current FHA will dominate the political discussion and smother this idea. But I still think it is worth articulating good policy proposals, in spite of the interest-group politics. If nothing else, this exposes the importance of public-choice considerations.