Ralph Perrey is the longest-serving executive director in the history of the Tennessee Housing Development Agency (THDA). He was appointed to the top post in 2012 after serving on THDA’s board of directors.
During his tenure, the state housing finance agency (HFA) has taken several big steps, including revamping its mortgage products and establishing its own loan-servicing division.
Perrey discusses today’s challenges and what’s coming.
What previous work experience prepared you to be the executive director of THDA, and what skills did you acquire in those positions?
I served on the senior staff of Tennessee Gov. Don Sundquist for five years and then directed the Fannie Mae Tennessee Partnership Office. Both of these positions enabled me to travel throughout our state and become familiar with the distinct characteristics of east, middle, and west Tennessee. The needs of each region are very different and are unique from the fast-growing counties around Nashville. Recognizing that, we at THDA have moved away from expecting one size to fit all when designing and administering programs. Coming into this position with knowledge of our state, familiarity with THDA and many of the people who work here, as well as many of the housing partners our agency works with across the state were key in setting me up for success.
What has been the biggest move THDA has made in the past year?
We have developed the ability to sell mortgages into the secondary market. This is old hat for many state HFAs but had never been part of THDA’s business model. Going forward, it allows us to finance mortgages without relying entirely on issuing bonds, limit our bonded indebtedness, and free up bond authority to support multifamily development. This is a big strategic shift for THDA and one that will allow us to do more to support housing and homeownership in Tennessee.
Is Tennessee facing any unique challenges in regard to housing and the availability of affordable housing?
Unique? No. Home prices and rents are rising everywhere in America. Fewer homes are on the market, especially at entry-level price points. As a nation, we have to build more housing.
What is the biggest challenge THDA is currently facing?
The biggest challenge to our business is a lack of houses that first-time buyers of modest means can afford. The biggest operational challenge is administering all of the new and expanded federal programs, many in response to the COVID-19 pandemic (THDA administers 15 federal programs on the state’s behalf).
What does the next five years look like for THDA?
I am actually optimistic about the next five years and see it as a time of opportunity for the agency. We have changed our business model for single-family mortgages, and, while we face short-term challenges with rising interest rates and short supply, down the road we have positioned ourselves to be able to meet the demand for homeownership finance. We have given ourselves three strong revenue streams (portfolio earnings, profit from the sale of loans into the secondary market, and loan servicing income) rather than just one. We are providing, for us, a record amount of support for the development of affordable rental housing and are positioned to continue that well into the future. We have an excellent leadership team and a well-motivated workforce that brings a sense of mission to our work as well as a proven track record in program administration and financial responsibility.
If you unexpectedly have the afternoon off, where would we find you?
At the ballpark, if it’s baseball season.