Trump’s nominee to head FHFA didn’t do anything to embarrass himself at his confirmation hearing this week, but he also didn’t demonstrate a deep understanding of housing finance.

Treasury Secretary Bessent’s cautious remarks about the prospect for GSE reform heighten industry skepticism about the release of Fannie Mae and Freddie Mac from conservatorship.

Obstacles like how to deal with the implicit guarantee and excessively high capital requirements make it unlikely that the GSEs will exit conservatorship under Trump, though the chances are higher than before his election.