Policy Advocacy Gains Urgency as Small Markets Drive Housing Growth

California Mortgage Bankers Association President Paul Gigliotti's call for industry policy engagement comes at a time when housing market dynamics are shifting toward smaller communities that may have limited advocacy resources.

In a HousingWire article published May 8, 2026, Gigliotti argued that mortgage professionals must treat policy advocacy as "part of industry innovation" rather than background noise, particularly as California considers new emergency relief bills. His message carries broader implications as housing growth concentrates in markets with varying levels of political representation.

Small Markets Lead Growth Despite Limited Voice

Current HavenScore data reveals a striking pattern: the strongest-performing ZIP codes by year-over-year growth are predominantly small communities. Dundas, Illinois (ZIP 62425) leads with a HavenScore of 70 and 25.4% annual growth, followed by Copper Hill, Virginia (ZIP 24079) at 23.2% growth with a score of 71.

These communities, along with Leonard, North Dakota (17.9% growth), Ogallah, Kansas (14.4% growth), and Darden, Tennessee (13.2% growth), represent markets that typically lack the lobbying infrastructure of major metropolitan areas. Yet they're experiencing the most significant housing market momentum according to HavenScore metrics.

The contrast is notable: while California debates emergency relief measures with substantial industry input, these high-growth rural markets may face policy decisions with minimal mortgage industry representation. Dundas, Illinois, for instance, sits in Putnam County with fewer than 6,000 residents total, according to Census data.

California's Policy Laboratory

Gigliotti's advocacy push centers on California's consideration of emergency relief bills, which he views as critical for industry innovation. The state's approach to housing policy often serves as a template for other jurisdictions, making California advocacy efforts particularly consequential.

The California MBA president emphasized that policy engagement should be viewed as innovation rather than regulatory compliance. This perspective suggests that mortgage professionals who actively participate in policy development can shape more effective regulations rather than simply responding to them.

California's housing market complexity provides a testing ground for policies that may later spread to other states. The state's combination of high prices, regulatory restrictions, and diverse geographic markets creates conditions that challenge traditional mortgage practices.

Insights from HavenScore Data

The concentration of high-growth markets in small communities raises questions about policy representation across different market types. HavenScore's top-performing ZIPs by growth metrics are overwhelmingly rural or small-town markets:

• Dundas, IL (62425): 25.4% YoY growth, score 70
• Copper Hill, VA (24079): 23.2% YoY growth, score 71
• Leonard, ND (58052): 17.9% YoY growth, score 70
• Ogallah, KS (67656): 14.4% YoY growth, score 75
• Darden, TN (38328): 13.2% YoY growth, score 75

These markets span different regions but share common characteristics: small populations, limited local financial services infrastructure, and potentially minimal representation in state-level policy discussions. The strong HavenScore performance suggests these communities are experiencing significant housing market activity despite their size.

The policy implications are significant. While large metropolitan areas typically have mortgage banking associations and industry representatives actively engaging with policymakers, smaller markets may rely on broader state or national advocacy efforts that may not address their specific needs.

Innovation Through Representation

Gigliotti's framework of treating policy as innovation becomes particularly relevant when considering these growth patterns. Traditional mortgage products and policies designed for urban markets may not serve high-growth rural communities effectively.

Small markets often face unique challenges: limited local lending options, different property types, varying economic drivers, and distinct demographic patterns. Policy innovations that work in California's major metros may require adaptation for communities like Leonard, North Dakota, where energy sector employment drives housing demand.

The mortgage industry's policy engagement has historically focused on major markets where large lenders and servicers have significant exposure. However, the growth patterns revealed by HavenScore data suggest that innovation opportunities may be emerging in markets with less policy attention.

Broader Implications for Industry Advocacy

The disconnect between where growth is happening and where policy attention focuses highlights a potential gap in industry advocacy. While California's emergency relief measures may address critical urban housing challenges, parallel policy needs may exist in high-growth small markets.

Mortgage professionals in these markets may need different advocacy approaches. State-level mortgage banking associations could play a larger role in representing small-market interests, while national organizations might need to consider how policies affect diverse market types.

The data also suggests that policy innovation should consider market diversity. Regulations developed for large, complex markets may create unintended barriers in smaller communities where different lending approaches might be more appropriate.

Gigliotti's call for treating policy as innovation rather than compliance takes on additional meaning when considering these market dynamics. True innovation might require policy frameworks that accommodate both California's complex urban markets and the growth happening in places like Dundas, Illinois.

The mortgage industry's policy engagement will likely need to evolve to address this geographic diversity in market performance, ensuring that advocacy efforts support housing finance innovation across all market types rather than focusing primarily on the largest metros.