Unlocking Value in Mortgage & Air Mobility: Fannie/Freddie Privatization and Joby's Regulatory Breakthroughs

In an era of shifting regulatory landscapes and technological innovation, two sectors—mortgage finance and air mobility—are poised for transformative growth. Fannie Mae (FNMA) and Freddie Mac (FMCC), the twin pillars of U.S. housing finance, face privatization efforts that could stabilize the mortgage market and unlock shareholder value. Meanwhile, Joby Aviation (JOBY) is advancing toward commercialization of its electric vertical takeoff and landing (eVTOL) aircraft, riding a wave of regulatory approvals and strategic partnerships. For investors, these twin catalysts present compelling opportunities: a contrarian bet on GSE reform and a speculative play on the dawn of urban air mobility.

Fannie/Freddie Privatization: A Contrarian Play on Mortgage Market Stability

Since their 2008 conservatorship under the Federal Housing Finance Agency (FHFA), Fannie and Freddie have operated in a regulatory limbo, their shares trading below intrinsic value. Recent developments suggest this could soon change. President Trump's “very serious consideration” of privatization, coupled with FHFA Director William Pulte's operational reforms, signals a turning point. Key catalysts include:

• Housing Goals and Credit Policy Clarity: The FHFA's finalized 2025–2027 goals mandate 25% of Fannie/Freddie loans to low-income buyers, balancing affordability with investor confidence. Pulte's focus on retaining the tri-merge credit report requirement (backed by bipartisan lawmakers) ensures lending standards remain robust.
• Political Support vs. Opposition: While Senator Elizabeth Warren warns of Wall Street windfalls, investors like Bill Ackman's Pershing Square—holding 14% of Fannie's shares—are betting on privatization unlocking trillions in equity. Current FMCC trades at $22.50, below its $25+ book value, with upside potential if dividends resume post-privatization.
• Market Stabilization: With mortgage rates at 6.76% (and rising), GSE reform could reduce borrowing costs long-term. Analysts estimate privatization could lower rates by 0.25–0.5%, making housing more accessible and boosting demand for GSE-backed securities.

Entry Point: Accumulate FMCC/FNMA at current lows. The $25 book value floor and Trump's 2026 election cycle timeline (a potential tailwind) make this a high-conviction, low-risk contrarian play.

Joby Aviation: The Regulatory Tailwinds Fueling Urban Air Mobility

Joby's progress in 2025 marks a pivotal shift for eVTOL adoption. With Toyota's $250M investment and Delta's $60M equity stake, the company is scaling production and nearing FAA certification. Key catalysts include:

• FAA Certification Milestones: Joby entered the final Type Inspection Authorization (TIA) phase in Q2 2025, completing static load testing and transitioning to piloted flights. Analysts project certification by late 2025, enabling commercial launches in the UAE and U.S. by 2026.
• Strategic Partnerships: Virgin Atlantic's London-Manchester routes and Toyota's manufacturing expertise position Joby to dominate early urban air mobility (UAM) markets. The $500M Toyota deal boosts cash reserves to $1.06B, de-risking production.
• Market Demand Surge: Post-Paris Olympics, eVTOL orders hit 11,700 globally, with APAC leading adoption. Joby's 150-mph Midnight aircraft (targeting LA Olympics in 2028) aligns with demand for rapid, eco-friendly transport.

Speculative Upside: At $12/share (post-Q2 rebound), JOBY trades at 20% of its 2021 high. With a $20–$30 target by 2026 (post-certification), this is a high-risk, high-reward bet on a nascent trillion-dollar sector. Early adopters in niche tourism markets (e.g., Dubai) could validate scalability.

Sector-Specific Catalysts: Why Now?

Mortgage Market: Privatization isn't just about profit—it's about stability. Fannie/Freddie's $7T mortgage portfolio ensures liquidity, and their reform will reduce taxpayer exposure. Investors who ignore political noise (Warren's opposition) and focus on fundamentals will profit.

Air Mobility: The FAA's 2024 powered-lift rules and Joby's TIA phase mark a regulatory inflection point. With eVTOL orders up 60% since 2023, early movers like Joby will set standards for safety and infrastructure, creating first-mover advantages.

Conclusion: Act Now—But Diversify

The mortgage and air mobility sectors are at crossroads of regulatory clarity and market demand. Fannie/Freddie offer a “value trap turned opportunity” at $22.50, while Joby bets on innovation at $12.

• Contrarian Play: Buy FMCC/FNMA dips below $20, targeting $30+ by 2026 (post-privatization).
• Speculative Growth: Accumulate JOBY below $15, with a $30+ target by 2027 (post-commercialization).

Both require patience—Fannie/Freddie for policy timelines, Joby for certification— but the rewards for early investors could be extraordinary. In markets craving stability and innovation, these are the plays to own now.