More steps needed to help stabilise imploding US housing market

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WASHINGTON, Jan 2 (Reuters): More steps by Congress and the Bush administration are likely needed to stabilise the imploding US housing market, a senior White House official said Tuesday, as more signs of distress appear.
Early last month, President George W Bush unveiled a plan to help some homeowners avoid foreclosures as some 1.8 million mortgages with low starter interest rates are due to reset to sharply higher rates this year.
Ed Gillespie, counsellor to Bush, pointed to efforts by the US Congress to overhaul the Federal Housing Administration programme developed in 1934 amid the great depression and designed to make home ownership more affordable. Members of the House of Representatives and Senate have been trying to work out a compromise plan.
"There's more to be done we think on the housing front to address the concerns people have about the housing markets, including FHA reform and other reforms that the president has called for," Gillespie told reporters aboard Air Force One as Bush returned from a weeklong holiday at his Texas ranch.
"We think there's an opportunity for bipartisan consensus on that."
One idea that has been under consideration by the administration and Congress is allowing mortgage finance companies Fannie Mae (FNM.N) and Freddie Mac (FRE.N) to buy loans above the current ceiling of $417,000, mortgages known as jumbo loans, he said.