A weekend topic starting with Market Watch. "There’s new hope to phase out Fannie Mae and Freddie Mac from the housing sector, a Heritage Foundation research fellow said at the annual Conservative Political Action Conference. Heritage’s Joel Griffith said while state zoning and environmental regulations are affecting the housing supply, the federal government is driving up prices by subsidizing loans with Fannie Mae and Freddie Mac."

"The goal is to gradually take it back to where the market was before the creation of these two agencies in 1968, Griffith said. 'If you phase it out,' Griffith said, 'you’ll see housing prices gradually return to those norms.'"

"He said slowly eliminating some functions of the two government-run housing loan institutions would stop putting taxpayers on the hook for loan defaults, and Americans will see the large gap between housing and incomes shrink."

"Griffith suggested raising down payment requirements and lowering the maximum loan amount, which is currently about $484,000. For many places, he said, that’s not a middle class home anymore."

"He was also critical of lawmakers from both political parties for supporting housing loans that encourage people to put less down and go with a longer loan, usually for about 30 years. 'You end up trapping people that might not otherwise have made that decision,' Griffith said."

From the Wall Street Journal. "The mortgage rate someone lands when they buy a house depends on many things, including their credit score, debt load and the particular lender. But a new study by online mortgage marketplace LendingTree reveals there’s another factor that plays a surprisingly significant role in the rate they lock in: which state they live in."

"An even bigger surprise? The state that emerged as the bargain of the bunch. Currently, the national average for a 30-year, fixed-rate conforming loan is 4.84%. But California—emblem of all that is expensive in every other aspect of real estate—has the lowest average mortgage rates in the nation, clocking in at 4.74%."

"The next best performers, rate-wise, include other states not particularly known for real-estate steals: New Jersey, Washington and Massachusetts, in that order."

"'The differences in the states are driven by local competition and business costs,' said Tendayi Kapfidze, chief economist for LendingTree. While LendingTree’s study analyzed conforming loans, 'it would be logical to assume that jumbo loans would follow this pattern,' he said."

"Many fixed costs to originate a loan—the financial analysis, signature-gathering and processing—are the same whether the loan is for $100,000 or $1 million, said Mr. Kapfidze. The average conventional loan size in California is $313,508, 68% higher than in Oklahoma, one of the states with the highest average rates, according to LendingTree’s data."

"Competition also drives down price. There were nearly 100,000 people based in California who were licensed to engage with consumers in some aspect of mortgage lending in 2017, according to the Nationwide Multistate Licensing System, a registrar of non-depository financial services. That’s nearly twice as many as in Texas, the state with the next-largest number of people licensed to work in real-estate lending."