While HBA members were busy Bringing Housing Home™ during in-district meetings with lawmakers, tax staff at the National Association of Home Builders were on Capitol Hill fighting to protect home ownership tax incentives, including the mortgage interest deduction, in any future tax reform effort.
The Senate Finance Committee is currently examining tax reform efforts and conducted a roundtable on home ownership tax rules that also included tax staff from industry groups and economists from Washington think tanks and local universities.
During the roundtable, NAHB staff and representatives from the Mortgage Bankers Association and National Association of Realtors® provided research and data explaining the history, role and beneficiaries of the mortgage interest and property tax deductions. The mortgage interest deduction is widely claimed by the middle class, providing nearly $70 billion in tax benefits a year to our nation’s home owners. Moreover, the benefits tend to be collected by younger households, who being in the early years of a mortgage, are paying more interest and thus claiming larger deductions.
The roundtable also discussed the capital gain exclusion, an important rule particularly for older home owners looking to relocate, as well the deduction for mortgage insurance (include PMI) and the exclusion for forgiven mortgage debt.
A Trillion-Dollar Hit
While economists from the think tanks made the argument that the housing tax incentives should be transformed, weakened, or perhaps eliminated, our housing experts explained to the Senate staffers the significant economic harm that would come from increasing the cost of home ownership. Citing studies from NAHB's Housing Economics team, academics, and tax think tanks, our team reported that repeal of the mortgage interest deduction would reduce GDP by $100 billion a year, eliminate at least $1 trillion in household net worth, and delay home ownership for younger households.
The Senate Finance Committee also will be holding other tax reform working groups and the collective findings could be used by members to craft a comprehensive tax reform bill later this year.
Many tax analysts believe that the 2015 political environment will not allow for consideration of comprehensive tax reform that includes changes to the individual side of the tax code. However, there is a window in 2015 for debate of business-only tax reform.
Your Home Builders Association has argued that business tax reform must include rate reductions for pass-through entities (S Corporations, LLCs), as well as C corporations. And business tax reform should protect key tax rules that encourage investment and economic growth, such as the Low-Income Housing Tax Credit, business loan interest deductibility, like-kind exchange, and tax accounting rules for home construction contracts.
As the association has been doing during earlier rounds of tax reform discussions, your Home Builders Association will continue to be highly engaged, presenting our research concerning housing and tax policy and the economic benefits of housing, home ownership and residential construction.
The Home Builders Association of Greenville are your neighbors and community leaders providing education and support for building industry professionals. We create jobs, encourage homeownership, and promote responsible growth throughout the upstate of South Carolina.
Showing posts with label mortgage interest deduction. Show all posts
Showing posts with label mortgage interest deduction. Show all posts
Thursday, April 16, 2015
Friday, April 19, 2013
NAHB: Mortgage Interest Deduction overwhelmingly benefits families earning less than $200,000 per year
In South Carolina the percentage is higher: 94.1 percent.
Higher cost states, like New York and California, have lower home ownership rates and therefore lower use of the mortgage interest deduction. The highest percentage of claimants earning less than $200,000 and using the mortgage interest deduction can be found in Idaho, at 95.4 percent. The lowest percentage of claimants is in Connecticut, at 87.4 percent.
Read the complete report at Eye on Housing by clicking here.
Wednesday, December 12, 2012
A Tax Profile of a Typical Mortgage Interest Deduction Beneficiary
A report by Robert Deitz, Ph.D., and Natalia Siniavskaia, Ph.D., of NAHB's Economics and Housing Policy Department, found that the overwhelming majority of taxpayers using the Mortgage Interest Deduction are middle class taxpayers. The report demonstrates the importance of preserving the Mortgage Interest Deduction.
Click here to read the complete report by Dr. Deitz and Dr. Siniavskaia at NAHB.org.
Click here to read the complete report by Dr. Deitz and Dr. Siniavskaia at NAHB.org.
Wednesday, August 22, 2012
GOP includes support for Mortgage Interest Deduction in Party Platform
The National Association of Home Builders (NAHB) today applauded the GOP Platform Drafting Committee for recognizing the importance of the mortgage interest deduction within its proposed platform.
“We are very pleased that the committee has recognized the crucial importance of the mortgage interest deduction,” said NAHB Chief Executive Officer Jerry Howard. “At a time when so many are struggling to recover from the recession, this action helps cement much-needed political support for a tax break that primarily benefits middle-income families.”
Including the mortgage interest deduction in the draft GOP platform also makes sense because of the broad support that the incentive enjoys among voters across the country, added Howard. An NAHB-commissioned poll this January found that 77 percent of Republicans, 71 percent of Independents and 71 percent of Democrats oppose eliminating this important tax break.
“Middle-class voters have seen their household wealth decline throughout the recession, and to a large extent they are the ones who will decide the outcome of this election,” noted Howard. “They are also the prime beneficiaries of the mortgage interest deduction. With this in mind, it seems obvious that maintaining this cornerstone of American housing policy should be among lawmakers’ primary goals.”
“We are very pleased that the committee has recognized the crucial importance of the mortgage interest deduction,” said NAHB Chief Executive Officer Jerry Howard. “At a time when so many are struggling to recover from the recession, this action helps cement much-needed political support for a tax break that primarily benefits middle-income families.”
Including the mortgage interest deduction in the draft GOP platform also makes sense because of the broad support that the incentive enjoys among voters across the country, added Howard. An NAHB-commissioned poll this January found that 77 percent of Republicans, 71 percent of Independents and 71 percent of Democrats oppose eliminating this important tax break.
“Middle-class voters have seen their household wealth decline throughout the recession, and to a large extent they are the ones who will decide the outcome of this election,” noted Howard. “They are also the prime beneficiaries of the mortgage interest deduction. With this in mind, it seems obvious that maintaining this cornerstone of American housing policy should be among lawmakers’ primary goals.”
Monday, January 16, 2012
Statewide poll shows overwhelming support for homeownership in South Carolina
With the South Carolina GOP presidential primary less than two weeks away, presidential contenders should heed a new statewide poll showing that voters in the Palmetto State believe that owning a home remains an integral part of the American Dream and that policymakers need to take active steps to protect homeownership.
“The survey underscores that South Carolina voters believe homeownership is a core value that anchors the middle class and they oppose efforts to eliminate or reduce the mortgage interest deduction and to make it more difficult for creditworthy home buyers to obtain affordable financing,” said Hal Dillard, president of the Home Builders Association of Greenville and a home builder in Greenville County.
“South Carolina’s voters are sending a clear message that the opportunity to own a home remains a cherished ideal and the government has an important role to play to keep homeownership affordable for hard-working American families,” added Dillard. “That’s a message we hope candidates running at all levels of government this November will heed.”
The polling found that 98 percent of South Carolina home owners are happy with their decision to purchase a home and 79 percent of all voters believe that despite the risk of ups and downs in the housing market, owning a home is one of the best long-term investments they can make.
Moreover, 65 percent of the respondents said they would be less likely to vote for a candidate for Congress who proposed eliminating the mortgage interest deduction and 73 percent believe it is appropriate and reasonable for the federal government to provide tax incentives to promote homeownership.
These are among the key findings of a survey of likely South Carolina voters that was conducted on behalf of the National Association of Home Builders by Public Opinion Strategies of Alexandria, Va., and Lake Research Partners of Washington, D.C.
Among the other survey results:
This statewide survey of 500 likely 2012 voters was conducted Jan. 2-5 by Public Opinion Strategies of Alexandria, Va., and Lake Research Partners of Washington, D.C. It has a margin of error of ±4.4 percent.
Read the complete results of the survey at HBAofGreenville.com by clicking here.
“The survey underscores that South Carolina voters believe homeownership is a core value that anchors the middle class and they oppose efforts to eliminate or reduce the mortgage interest deduction and to make it more difficult for creditworthy home buyers to obtain affordable financing,” said Hal Dillard, president of the Home Builders Association of Greenville and a home builder in Greenville County.
“South Carolina’s voters are sending a clear message that the opportunity to own a home remains a cherished ideal and the government has an important role to play to keep homeownership affordable for hard-working American families,” added Dillard. “That’s a message we hope candidates running at all levels of government this November will heed.”
The polling found that 98 percent of South Carolina home owners are happy with their decision to purchase a home and 79 percent of all voters believe that despite the risk of ups and downs in the housing market, owning a home is one of the best long-term investments they can make.
Moreover, 65 percent of the respondents said they would be less likely to vote for a candidate for Congress who proposed eliminating the mortgage interest deduction and 73 percent believe it is appropriate and reasonable for the federal government to provide tax incentives to promote homeownership.
These are among the key findings of a survey of likely South Carolina voters that was conducted on behalf of the National Association of Home Builders by Public Opinion Strategies of Alexandria, Va., and Lake Research Partners of Washington, D.C.
Among the other survey results:
- 99 percent of home owners said that it is important that they own their own home.
- Homeownership and a retirement savings program are considered by voters to be their best investments.
- Nearly three out of four voters who are not currently home owners (73 percent) said it was a goal of theirs to buy a home.
- 64 percent believe it is appropriate and reasonable for the federal government to help home buyers afford a long-term or 30-year fixed-rate mortgage.
- 68 percent of voters would oppose eliminating or reducing tax deductions such as the mortgage interest deduction in exchange for a lower federal income tax rate if it meant that their final tax bill would be higher.
This statewide survey of 500 likely 2012 voters was conducted Jan. 2-5 by Public Opinion Strategies of Alexandria, Va., and Lake Research Partners of Washington, D.C. It has a margin of error of ±4.4 percent.
Read the complete results of the survey at HBAofGreenville.com by clicking here.
Tuesday, January 10, 2012
NAHB: Federal Legislative Priorities for 2012
You are a member of your Home Builders Association. Do you wonder what your association is doing for you in the Federal arena. 2012 is a critical year on the government scene for home builders. Your National Association of Home Builders has published is priorities for the year and they are listed and detailed below.
Summary
1. End the Housing Production Credit Crisis
It is absolutely vital to get credit flowing to the housing sector again. In the current regulatory climate, lenders have basically stopped making acquisition, development and construction (AD&C) loans that are necessary to allow builders to construct new homes. Credit is the lifeblood of housing. Home builders cannot keep their doors open and create jobs in their communities if they cannot get credit to build even pre-sold homes. And when lenders call in performing loans, everyone suffers. Workers get laid off, sound projects go uncompleted and banks take possession of unfinished property.
Federal bank regulators maintain that they are not encouraging institutions to stop making loans or to indiscriminately liquidate outstanding loans. However, NAHB members who are dealing with banks all across the country suggest that bank examiners in the field are adopting a significantly more aggressive stance on AD&C loans out of fear of the regulators coming into the banks and targeting them.
With inventories of new homes nearly depleted in many markets, builders should be gearing up to meet demand, create new jobs and keep the economic expansion moving forward. The only thing holding builders back in these locations are traditional lenders, who still aren’t providing the credit needed to renew the production process.
NAHB is urging Congress to support legislation introduced on May 5 by Reps. Gary Miller (R-Calif.) and Brad Miller (D-Calif.) that would help restore the flow of credit to the housing sector. H.R. 1755, the Home Construction Lending Regulatory Improvement Act of 2011, offers a legislative solution aimed at ending the freeze in housing production credit that has forced countless home building firms across the nation to shutter their doors, resulting in grave repercussions for job growth and the overall economy.
For more information, see the text of the legislation or read NAHB’s press release.
2. Resolve the Faulty Appraisal Process
Appraisals remain a major problem for the housing industry. The process has gone seriously wrong because some appraisers are using distressed properties – many of which have been neglected and are in poor physical condition – as comparables in assessing the value of brand new homes without accounting for major differences in condition and quality. Without such adjustments, the two are not comparable. Appraisers don’t typically enter these fixer-up homes; if they did, they would likely recognize the substantial differences between a foreclosure that lacks working appliances and a new home fitted with state-of-the-art appliances.
Too often, due to faulty appraisal practices, the builder’s house winds up getting appraised at less than the cost of construction. This is not only unfair and unreasonable, but it perpetuates the cycle of declining home values, drives more home owners underwater, negatively affects housing demand and acts as an obstacle to the recovery of the housing market. Major reforms in appraisal practices and oversight are needed to ensure that appraisals accurately reflect true market values and don’t contribute to price volatility.
For more information on the appraisal issue, see the Nov. 7 special edition of Nation's Building News.
3. Protect the Mortgage Interest Deduction
Americans overwhelmingly oppose any action by Congress to tamper with the mortgage interest deduction, but it could be eliminated or scaled back as federal lawmakers and the Administration are looking at tax increases in light of deficit concerns.
The consequences would be devastating for home owners, the housing market and the nation’s economy. Any attempts to tamper with the mortgage interest deduction would raise taxes on millions of home buyers and home owners and further depress home values, leaving more home owners with mortgages larger than the value of their property (“underwater”) and fueling even more foreclosures.
This cornerstone of American housing policy has been in place since the inception of the tax code nearly 100 years ago and supports the aspirations of families at all income levels to become home buyers. Nearly 37 million home owners directly benefit from the mortgage interest deduction and 70 percent of the benefit goes to middle-class home owners who make less than $200,000.
Many in Congress agree that tampering with the mortgage interest deduction would harm consumers and the economy. House resolution H. Res. 25 expresses a "sense of Congress that the current federal income tax deduction for interest paid on debt secured by a first or second home should not be further restricted.” The resolution, which has more than 180 cosponsors, shows that lawmakers are aware of the critical role that the MID plays in supporting homeownership in this country. NAHB is encouraging supporters to call the Capitol Switchboard at 202-224-3121 and urge their representatives to co-sponsor H. Res. 25.
To educate the public on the importance of preserving the mortgage interest deduction as a cornerstone of American housing policy, NAHB has created a consumer-oriented website, SaveMyMortgageInterestDeduction.com. The website contains fact sheets, frequently asked questions, statistics, and other important information to allow consumers to stay informed as debate on the mortgage interest deduction moves forward.
Most importantly, SaveMyMortgageInterestDeduction.com tells visitors how to remain engaged and make sure their opinions are heard on this important issue by connecting through NAHB’s Facebook and Twitter mortgage interest deduction communities and Eye on Housing blog.
4. Maintain Federal Support for Housing Finance System
Some members of Congress are actively pushing to abolish Fannie Mae and Freddie Mac and end the federal backstop for housing. Absent a federal role to help reassure mortgage market investors, the 30-year, fixed rate mortgage, the major housing finance tool for most Americans, would become increasingly scarce and much more costly, pricing many creditworthy borrowers out of the marketplace. Similarly, the availability of financing for multifamily housing would fall woefully short of the growing need.
In the wake of the financial crisis, the Federal Housing Administration, Fannie Mae and Freddie Mac have become the primary sources of financing for residential housing.
Even with the current high level of federal support, fewer mortgage products are available now than in the past, and these loans are being underwritten on much more stringent terms. As the private market assumes a greater role in the mortgage marketplace, maintaining an appropriate level of government support is essential to preserve financial stability, promote investor confidence and ensure liquidity and stability for homeownership and rental housing.
Complicating the situation, the federal government is looking to trim back the Federal Housing Administration’s participation in the market, which would further limit the availability of low downpayment mortgages.
- End the Housing Production Credit Crisis
- Resolve the Faulty Appraisal Process
- Protect the Mortgage Interest Deduction
- Maintain Federal Support for Housing Finance System
- Preserve Affordable Downpayments and Mortgages
- Recognize Housing’s Important Role to the Economy
- Defend the Low Income Housing Tax Credit
Read details about each issue below.
1. End the Housing Production Credit Crisis
It is absolutely vital to get credit flowing to the housing sector again. In the current regulatory climate, lenders have basically stopped making acquisition, development and construction (AD&C) loans that are necessary to allow builders to construct new homes. Credit is the lifeblood of housing. Home builders cannot keep their doors open and create jobs in their communities if they cannot get credit to build even pre-sold homes. And when lenders call in performing loans, everyone suffers. Workers get laid off, sound projects go uncompleted and banks take possession of unfinished property.
Federal bank regulators maintain that they are not encouraging institutions to stop making loans or to indiscriminately liquidate outstanding loans. However, NAHB members who are dealing with banks all across the country suggest that bank examiners in the field are adopting a significantly more aggressive stance on AD&C loans out of fear of the regulators coming into the banks and targeting them.
With inventories of new homes nearly depleted in many markets, builders should be gearing up to meet demand, create new jobs and keep the economic expansion moving forward. The only thing holding builders back in these locations are traditional lenders, who still aren’t providing the credit needed to renew the production process.
NAHB is urging Congress to support legislation introduced on May 5 by Reps. Gary Miller (R-Calif.) and Brad Miller (D-Calif.) that would help restore the flow of credit to the housing sector. H.R. 1755, the Home Construction Lending Regulatory Improvement Act of 2011, offers a legislative solution aimed at ending the freeze in housing production credit that has forced countless home building firms across the nation to shutter their doors, resulting in grave repercussions for job growth and the overall economy.
For more information, see the text of the legislation or read NAHB’s press release.
2. Resolve the Faulty Appraisal Process
Appraisals remain a major problem for the housing industry. The process has gone seriously wrong because some appraisers are using distressed properties – many of which have been neglected and are in poor physical condition – as comparables in assessing the value of brand new homes without accounting for major differences in condition and quality. Without such adjustments, the two are not comparable. Appraisers don’t typically enter these fixer-up homes; if they did, they would likely recognize the substantial differences between a foreclosure that lacks working appliances and a new home fitted with state-of-the-art appliances.
Too often, due to faulty appraisal practices, the builder’s house winds up getting appraised at less than the cost of construction. This is not only unfair and unreasonable, but it perpetuates the cycle of declining home values, drives more home owners underwater, negatively affects housing demand and acts as an obstacle to the recovery of the housing market. Major reforms in appraisal practices and oversight are needed to ensure that appraisals accurately reflect true market values and don’t contribute to price volatility.
For more information on the appraisal issue, see the Nov. 7 special edition of Nation's Building News.
3. Protect the Mortgage Interest Deduction
Americans overwhelmingly oppose any action by Congress to tamper with the mortgage interest deduction, but it could be eliminated or scaled back as federal lawmakers and the Administration are looking at tax increases in light of deficit concerns.
The consequences would be devastating for home owners, the housing market and the nation’s economy. Any attempts to tamper with the mortgage interest deduction would raise taxes on millions of home buyers and home owners and further depress home values, leaving more home owners with mortgages larger than the value of their property (“underwater”) and fueling even more foreclosures.
This cornerstone of American housing policy has been in place since the inception of the tax code nearly 100 years ago and supports the aspirations of families at all income levels to become home buyers. Nearly 37 million home owners directly benefit from the mortgage interest deduction and 70 percent of the benefit goes to middle-class home owners who make less than $200,000.
Many in Congress agree that tampering with the mortgage interest deduction would harm consumers and the economy. House resolution H. Res. 25 expresses a "sense of Congress that the current federal income tax deduction for interest paid on debt secured by a first or second home should not be further restricted.” The resolution, which has more than 180 cosponsors, shows that lawmakers are aware of the critical role that the MID plays in supporting homeownership in this country. NAHB is encouraging supporters to call the Capitol Switchboard at 202-224-3121 and urge their representatives to co-sponsor H. Res. 25.
To educate the public on the importance of preserving the mortgage interest deduction as a cornerstone of American housing policy, NAHB has created a consumer-oriented website, SaveMyMortgageInterestDeduction.com. The website contains fact sheets, frequently asked questions, statistics, and other important information to allow consumers to stay informed as debate on the mortgage interest deduction moves forward.
Most importantly, SaveMyMortgageInterestDeduction.com tells visitors how to remain engaged and make sure their opinions are heard on this important issue by connecting through NAHB’s Facebook and Twitter mortgage interest deduction communities and Eye on Housing blog.
4. Maintain Federal Support for Housing Finance System
Some members of Congress are actively pushing to abolish Fannie Mae and Freddie Mac and end the federal backstop for housing. Absent a federal role to help reassure mortgage market investors, the 30-year, fixed rate mortgage, the major housing finance tool for most Americans, would become increasingly scarce and much more costly, pricing many creditworthy borrowers out of the marketplace. Similarly, the availability of financing for multifamily housing would fall woefully short of the growing need.
In the wake of the financial crisis, the Federal Housing Administration, Fannie Mae and Freddie Mac have become the primary sources of financing for residential housing.
Even with the current high level of federal support, fewer mortgage products are available now than in the past, and these loans are being underwritten on much more stringent terms. As the private market assumes a greater role in the mortgage marketplace, maintaining an appropriate level of government support is essential to preserve financial stability, promote investor confidence and ensure liquidity and stability for homeownership and rental housing.
Complicating the situation, the federal government is looking to trim back the Federal Housing Administration’s participation in the market, which would further limit the availability of low downpayment mortgages.
Reps. Gary Miller (R-Calif.) and Carolyn McCarthy (D-N.Y.) on July 7 introduced H.R. 2413, the Secondary Market Facility for Residential Mortgages Act of 2011. The bill would stabilize housing and ensure liquidity in the mortgage market by maintaining a federal role in the U.S. housing finance system.
Similar bipartisan legislation (H.R. 1859) introduced this spring by Reps. John Campbell (R-Calif.) and Gary Peters (D-Mich.) would replace Fannie Mae and Freddie Mac with five private companies that would issue mortgage-backed securities and have government backing.
Similar bipartisan legislation (H.R. 1859) introduced this spring by Reps. John Campbell (R-Calif.) and Gary Peters (D-Mich.) would replace Fannie Mae and Freddie Mac with five private companies that would issue mortgage-backed securities and have government backing.
NAHB has presented lawmakers with a detailed proposal on restructuring the housing finance system to provide a consistent supply of mortgage liquidity and retain a federal backstop while limiting taxpayer exposure. Actively involved in this issue, the association continues to encourage all congressional efforts that seek an appropriate federal role to ensure a reliable and adequate flow of affordable housing credit.
Meanwhile, in an important victory for consumers, President Obama on Nov. 18 signed into law legislation passed by Congress to restore higher loan limits through 2013 for mortgages backed by the Federal Housing Administration. Restoring the higher FHA loan limits will help to stabilize home values, provide constancy while private investors re-enter the market and enable millions of creditworthy consumers to get home loans with the best mortgage rates and lowest fees and downpayment requirements.
For more information, click on the links below:
Six federal agencies are proposing a national Qualified Residential Mortgage (QRM) standard that would require a minimum 20 percent downpayment, which would keep homeownership out of reach of most first-time home buyers and middle-class households.
In addition, the QRM plan includes several other bad ideas that would seriously impact the average family’s ability to affordably obtain a home of their own. It would mandate restrictive debt-to-income ratios to qualify for a home loan and prevent 25 million current home owners from refinancing to lower mortgage rates because they lack the required 25 percent equity in their homes.
High downpayment and equity rules along with excessive underwriting requirements will not have a meaningful impact on default rates but it will tighten lending rules to the point where millions of creditworthy home buyers won’t be able to qualify for a mortgage. Responsible consumers who maintain good credit and seek safe loan products will be forced into more expensive mortgages under the terms of the proposed rule simply because they do not have 20 percent or more in downpayment or equity. In other words, the proposal unfortunately penalizes qualified, low-risk borrowers.
About 62 percent of first mortgages taken out to purchase a home last year would not have qualified under the proposed QRM standard because they had downpayments of less than 20 percent, according to LPS Applied Analytics, a mortgage data firm.
NAHB estimates that it would take 12 years for a typical family to save enough money for a 20 percent downpayment on a median-priced single-family home and other research has found it would take even longer. Borrowers unable to make a 20 percentdownpayment or to obtain FHA financing would be expected to pay a premium of up to two percentage points for a loan in the private market to offset the increased risk to lenders, according to NAHB economists. This would annually disqualify about 5 million potential home buyers, resulting in 250,000 fewer home purchases each year.
If buyers are denied access to affordable housing credit, the shadow inventory of foreclosed homes will not be drawn down, a housing recovery will not take hold and economic growth will stall.
Low-downpayment home loans have been originated safely for decades and did not cause the housing lending crisis. Subprime, no-documentation loans and other alternative mortgage products crashed the economy. The Administration and regulators must acknowledge this fact and offer a new plan that ensures a safe and healthy mortgage market and keeps homeownership affordable for working American families.
For more information on this topic, click on the links below:
As policymakers begin debate on housing finance and budget issues that will impact job creation and future growth, they must understand the important role that housing plays in the U.S. economy. Considering the enormity of the total number of jobs attached to housing, a sector that accounts for 15 percent of the nation’s Gross Domestic Product, now is hardly the time to step back from the nation’s long-standing commitment to homeownership.
Building 100 average single-family homes generates more than 300 jobs and nearly $9 million in taxes and revenue for state, local and federal governments. Perhaps more than any other consumer product, housing is “Made in America.” New homes and apartments don’t arrive in this country on container ships from Europe or Asia, and most of the products used in home construction and remodeling are manufactured here in the United States.
More than 1.4 million residential construction jobs have been lost since April 2006. The pace of recovery is debatable, but based purely on population growth and demographics, the U.S. will need to build 17 million additional homes over the next decade.
The gap between current production and potential housing production is more than 1 million homes. That represents more than 3 million untapped American jobs. This gap is a result of multiple factors, including deferred household formations, a lack of construction financing and flawed appraisal practices under which new homes get compared to distressed and foreclosed properties, thereby distorting true market values.
There can be no economic recovery without a housing recovery. The path forward is perfectly clear: Congress needs to take actions to restore the health of the housing industry to put America back to work.
This is a sentiment shared by American voters as well. A recent NAHB survey of likely 2012 voters conducted by Public Opinion Strategies and Lake Research Partners found that despite the ups and downs of the housing market, home owners and non-owners alike consider owning a home essential to the American Dream and support politicians who embrace pro-housing policies and the mortgage interest deduction.
For more information, click on the links below:
- Restoring higher FHA loan limits provides a much-needed boost to the mortgage market
- Bipartisan House bill maintains a federal role in restructured housing finance system
- NAHB testimony before the Senate Banking Committee on the future of the housing finance system
- NAHB press release on Senate Banking Committee hearing
- Principles for restoring stability to the nation’s housing finance system
- NAHB press statement on House hearing examining housing finance issues
- Statement from NAHB on proposals to eliminate the role of Fannie Mae and Freddie Mac in the U.S. mortgage market
- Fannie Mae, Freddie Mac and FHA Loan Limit Changes for 2011: Scope of Impact
Six federal agencies are proposing a national Qualified Residential Mortgage (QRM) standard that would require a minimum 20 percent downpayment, which would keep homeownership out of reach of most first-time home buyers and middle-class households.
In addition, the QRM plan includes several other bad ideas that would seriously impact the average family’s ability to affordably obtain a home of their own. It would mandate restrictive debt-to-income ratios to qualify for a home loan and prevent 25 million current home owners from refinancing to lower mortgage rates because they lack the required 25 percent equity in their homes.
High downpayment and equity rules along with excessive underwriting requirements will not have a meaningful impact on default rates but it will tighten lending rules to the point where millions of creditworthy home buyers won’t be able to qualify for a mortgage. Responsible consumers who maintain good credit and seek safe loan products will be forced into more expensive mortgages under the terms of the proposed rule simply because they do not have 20 percent or more in downpayment or equity. In other words, the proposal unfortunately penalizes qualified, low-risk borrowers.
About 62 percent of first mortgages taken out to purchase a home last year would not have qualified under the proposed QRM standard because they had downpayments of less than 20 percent, according to LPS Applied Analytics, a mortgage data firm.
NAHB estimates that it would take 12 years for a typical family to save enough money for a 20 percent downpayment on a median-priced single-family home and other research has found it would take even longer. Borrowers unable to make a 20 percentdownpayment or to obtain FHA financing would be expected to pay a premium of up to two percentage points for a loan in the private market to offset the increased risk to lenders, according to NAHB economists. This would annually disqualify about 5 million potential home buyers, resulting in 250,000 fewer home purchases each year.
If buyers are denied access to affordable housing credit, the shadow inventory of foreclosed homes will not be drawn down, a housing recovery will not take hold and economic growth will stall.
Low-downpayment home loans have been originated safely for decades and did not cause the housing lending crisis. Subprime, no-documentation loans and other alternative mortgage products crashed the economy. The Administration and regulators must acknowledge this fact and offer a new plan that ensures a safe and healthy mortgage market and keeps homeownership affordable for working American families.
For more information on this topic, click on the links below:
- Lawmakers join industry groups to urge revising minimum 20 percent down requirement
- Industry White Paper on QRMs
- Consumer, banking and housing groups issue joint statement on proposed QRM rules
- Diverse groups respond to proposed rule for QRMs
- NAHB press release on how 20 percent downpayment rule would disrupt housing market
As policymakers begin debate on housing finance and budget issues that will impact job creation and future growth, they must understand the important role that housing plays in the U.S. economy. Considering the enormity of the total number of jobs attached to housing, a sector that accounts for 15 percent of the nation’s Gross Domestic Product, now is hardly the time to step back from the nation’s long-standing commitment to homeownership.
Building 100 average single-family homes generates more than 300 jobs and nearly $9 million in taxes and revenue for state, local and federal governments. Perhaps more than any other consumer product, housing is “Made in America.” New homes and apartments don’t arrive in this country on container ships from Europe or Asia, and most of the products used in home construction and remodeling are manufactured here in the United States.
More than 1.4 million residential construction jobs have been lost since April 2006. The pace of recovery is debatable, but based purely on population growth and demographics, the U.S. will need to build 17 million additional homes over the next decade.
The gap between current production and potential housing production is more than 1 million homes. That represents more than 3 million untapped American jobs. This gap is a result of multiple factors, including deferred household formations, a lack of construction financing and flawed appraisal practices under which new homes get compared to distressed and foreclosed properties, thereby distorting true market values.
There can be no economic recovery without a housing recovery. The path forward is perfectly clear: Congress needs to take actions to restore the health of the housing industry to put America back to work.
This is a sentiment shared by American voters as well. A recent NAHB survey of likely 2012 voters conducted by Public Opinion Strategies and Lake Research Partners found that despite the ups and downs of the housing market, home owners and non-owners alike consider owning a home essential to the American Dream and support politicians who embrace pro-housing policies and the mortgage interest deduction.
An overwhelming 75 percent of the respondents said that owning a home is worth the risk of the fluctuations in the market and 73 percent of those who do not own a home say it is a goal of theirs to eventually buy one. Equally telling, more than 70 percent of voters believe the federal government should provide tax incentives to promote homeownership and oppose proposals to eliminate the mortgage interest deduction -- a sentiment that cuts across party lines.
For more information on this topic, click on the following links:
- Poll finds big disconnect between Washington policymakers and voters on value of housing
- Direct impact of home building and remodeling on U.S. economy
- Economic benefits of new home construction
- Housing’s contribution to Gross Domestic Product
As Congress looks at tax expenditures and all programs come under review, it is important to protect the Low Income Housing Tax Credit (LIHTC), the most successful affordable rental housing production program in U.S. history. Eliminating the LIHTC would bring production and rehabilitation of affordable rental housing to a standstill.
Since its inception, the program has made possible the production of more than 2 million affordable apartments. It creates approximately 95,000 new full-time jobs, adds $7.1 billion in income to the economy and generates approximately $2.8 billion in federal, state and local taxes each year. In recent years, the LIHTC has produced about 75,000 new apartment homes annually.
The demand for affordable housing is acute and far exceeds the ability of LIHTC projects to keep pace. The program is essential to address the shortage of affordable housing options in our cities and towns.
Setting the Record Straight About Housing
By Earl McLeod
As the debate over tax reform and the regulatory structure of the housing finance system intensifies, misconceptions about housing and finance are proliferating. Following is the truth about some of the most widespread inaccuracies.
As the debate over tax reform and the regulatory structure of the housing finance system intensifies, misconceptions about housing and finance are proliferating. Following is the truth about some of the most widespread inaccuracies.
Misconception: Only the wealthy benefit from the mortgage interest deduction.
This pervasive fiction is a commonly cited reason for justifying elimination of the mortgage interest deduction.
Income tax deductions for mortgage interest and real estate taxes primarily benefit middle-class taxpayers with incomes between $50,000 and $200,000. And among first-time home buyers, 68 percent of households earn less than $80,000. First-time home buyers benefit most from the mortgage interest deduction because more of their mortgage payment is applied to interest.
Misconception: In the wake of the recession and housing market downturn, Americans have become disenchanted with homeownership and it is no longer a part of the American Dream.
Not so, according to a March 2011 study by the Pew Research Center. Among the more than 2,100 people surveyed, 81 percent agreed that homeownership is the best long-term investment a person can make. That sentiment even held true among those who said their homes lost value during the recession; 82 percent of that group indicated that homeownership is the best long-term investment a person can make.
Misconception: Eliminating government sponsored enterprises like Fannie Mae and Freddie Mac would have no effect on rental housing.
Investing in new and existing rental housing requires access to affordable financing. In the wake of the financial crisis, Fannie Mae and Freddie Mac, along with the Federal Housing Administration (FHA), have become the primary sources of financing for rental properties of all types. In considering whether the government should continue to guarantee mortgages through Fannie Mae and Freddie Mac or some other mechanism, policymakers should keep in mind their importance as a stable, long-term source of financing for rental as well as owner-occupied housing, according to the Joint Center for Housing Studies of Harvard University.
Misconception: Homeownership advocates say everyone should own a home.
Homeownership isn’t for everyone, but everyone should be able to choose a home that meets their needs, whether they rent or buy. And government policies, such as the proposed Qualified Residential Mortgage standard, should not limit homeownership opportunities unnecessarily.
Earl McLeod is Executive Director of the Greater Columbia Home Builders Association and a member of the South Carolina Home Builders Housing Hall of Fame.
Earl McLeod is Executive Director of the Greater Columbia Home Builders Association and a member of the South Carolina Home Builders Housing Hall of Fame.
Monday, October 17, 2011
NAHB Chairman Bob Nielson speaks on Fox Business Network about preserving the mortgage interest deduction
NAHB Chairman Bob Nielson went on Fox Business Network to support the mortgage interest deduction.
Click here to watch NAHB's Bob Nielson on Fox Business Network.
Click here to watch NAHB's Bob Nielson on Fox Business Network.
Tuesday, January 11, 2011
Mortgage Interest Deduction Primarily Benefits Middle Class
According to a study just completed by NAHB, the benefits of the mortgage interest and real estate tax deductions are collected primarily by the middle class.
The deductions for mortgage interest and real estate taxes are important and long-established tax provisions that benefit homeowners and stakeholders in the housing sector. As a result of recent proposal to increase taxes to address the long-term federal budget structural deficit, these deductions have been called into question.
The data and estimates in the study demonstrate that the benefits of these deductions are collected primarily by middle-class taxpayers, with incomes between $50,000 and $200,000. Moreover, greater benefits are earned by larger households and families, such as those with children. The data also show that as a share of household income, larger benefits are collected by families with less than $200,000 income, meaning that these tax rules make the tax system more progressive.
Read the entire report at NAHB.org by clicking here.
The deductions for mortgage interest and real estate taxes are important and long-established tax provisions that benefit homeowners and stakeholders in the housing sector. As a result of recent proposal to increase taxes to address the long-term federal budget structural deficit, these deductions have been called into question.
The data and estimates in the study demonstrate that the benefits of these deductions are collected primarily by middle-class taxpayers, with incomes between $50,000 and $200,000. Moreover, greater benefits are earned by larger households and families, such as those with children. The data also show that as a share of household income, larger benefits are collected by families with less than $200,000 income, meaning that these tax rules make the tax system more progressive.
Read the entire report at NAHB.org by clicking here.
Thursday, December 2, 2010
NAHB Launches Mortgage Interest Deduction Website
This week President's Obama's Deficit Reduction Commission will vote on a set of recommendations to the President and Congress for reducing the Federal deficit. Among the recommendations is a proposal to severely curtail the mortgage interest deduction. Clearly this proposal is of concern to Home Builders and could drive the Home Building Industry further into recession.
NAHB has launched a new website at www.SaveMyMortgageInterestDeduction.com to help provide both members and consumers with up-to-date information on the threat to the mortgage interest deduction.
The site, modeled after NAHB's successful federal home buyer tax credit site, separates the myths about the mortgage interest deduction from reality and contains fact sheets, frequently asked questions, press releases, media stories, statistics, reports, and more.
Most importantly, SaveMyMortgageInterestDeduction.com tells visitors how to stay informed and make sure their opinions are heard on this crucial issue by connecting through NAHB's Facebook and Twitter mortgage interest deduction communities and our Eye on Housing blog.
Rest assured that NAHB has been ahead of the curve on this issue on Capitol Hill and in the media, and has proactively developed cutting edge research and polling data to ensure that all of our members' interests are fully represented as this debate unfolds.
Update: The following is a statement from NAHB Chairman Bob Jones regarding the Deficit Commission's Proposal:
"While we commend the hard work of the President’s deficit commission to improve the nation’s fiscal situation, this is simply the wrong approach to the problem. It would put a huge tax increase on millions of middle-class home owners by eliminating or devaluing the mortgage interest deduction. The consequences would be devastating for housing and the economy. This would further depress home prices, putting countless more home owners underwater and triggering a new wave of foreclosures. Eliminating or scaling back this vital housing deduction will shrink the local tax base of many communities, causing already cash-strapped state and local governments to further cut jobs and essential services. Given the extreme fragility of the housing market, with 21 percent of construction workers currently idled, tampering with the mortgage interest deduction is just not sound public policy."
NAHB has launched a new website at www.SaveMyMortgageInterestDeduction.com to help provide both members and consumers with up-to-date information on the threat to the mortgage interest deduction.
The site, modeled after NAHB's successful federal home buyer tax credit site, separates the myths about the mortgage interest deduction from reality and contains fact sheets, frequently asked questions, press releases, media stories, statistics, reports, and more.
Most importantly, SaveMyMortgageInterestDeduction.com tells visitors how to stay informed and make sure their opinions are heard on this crucial issue by connecting through NAHB's Facebook and Twitter mortgage interest deduction communities and our Eye on Housing blog.
Rest assured that NAHB has been ahead of the curve on this issue on Capitol Hill and in the media, and has proactively developed cutting edge research and polling data to ensure that all of our members' interests are fully represented as this debate unfolds.
Update: The following is a statement from NAHB Chairman Bob Jones regarding the Deficit Commission's Proposal:
"While we commend the hard work of the President’s deficit commission to improve the nation’s fiscal situation, this is simply the wrong approach to the problem. It would put a huge tax increase on millions of middle-class home owners by eliminating or devaluing the mortgage interest deduction. The consequences would be devastating for housing and the economy. This would further depress home prices, putting countless more home owners underwater and triggering a new wave of foreclosures. Eliminating or scaling back this vital housing deduction will shrink the local tax base of many communities, causing already cash-strapped state and local governments to further cut jobs and essential services. Given the extreme fragility of the housing market, with 21 percent of construction workers currently idled, tampering with the mortgage interest deduction is just not sound public policy."
Friday, November 19, 2010
Elimination of Mortgage Interest Deduction, Sales Tax on New Homes Proposed
Recommendations to scale back on the mortgage interest deduction and other housing tax provisions included in two deficit reduction draft proposals released one week apart have raised serious concerns for the nation’s home builders.
A discussion draft unveiled on Nov. 10 by Erskine Bowles and former Senator Alan Simpson, the co-chairs of President Obama's bipartisan Commission on Fiscal Responsibility and Reform, lists options to completely eliminate the mortgage interest deduction or limit it to primary residences and mortgages under $500,000.
Other recommendations would be adverse for the Low Income Housing Tax Credit (LIHTC), the deduction for real estate taxes for home owners, accelerated depreciation for rental housing, energy tax incentives and tax-exempt housing bonds. In addition, the proposals would result in significantly higher tax rates for capital gains and dividends.
However, none of these proposals has been formalized, and they are only listed as potential "options." Moreover, the overall plan, which includes many controversial recommendations on Social Security, health care, defense spending and other issues, must win support of 14 of the 18 commissioners in order for Congress to consider the package. This is a high hurdle and requires the support of both Republican and Democratic members of the commission.
The commission itself has no actual power to implement its official recommendations and many of the proposals put forth by the chairmen are unlikely to garner bipartisan support.
Reactions to the plan from both sides of the political aisle have varied, ranging from outright opposition to cautious interest.
A National Sales Tax and Devaluation of the Mortgage Interest Deduction
On Nov. 17, Pete Domenici, a former Republican Senate Budget Committee Chairman, and Alice Rivlin, former head of the Office of Management and Budget under President Clinton and a member of the president’s debt commission, released their own deficit reduction plan as co-chairs of the Bipartisan Policy Center’s Debt Reduction Task Force.
The Domenici-Rivlin plan to reduce America’s deficits would devalue the mortgage interest deduction by replacing it with a 15 percent refundable tax credit for anyone who owns a home. It would also eliminate several other tax rules related to housing, including the Low Income Housing Tax Credit, real estate tax deductions and deductions for second homes and home equity loans.
The proposal would further impose a new 6.5 percent national sales tax that would be applicable for new home sales and remodeling projects, but not for the purchase of existing homes. With the average nationwide price of a new home at $257,500, this plan would impose a whopping $16,738 tax increase on a typical new-home purchase and price more than three million households out of the new-home sales market.
While the Domenici-Rivlin and Bowles-Simpson proposals are sparking controversy across the political spectrum, it has become increasingly clear that policymakers are taking a close look at the mortgage interest deduction and other housing incentives with an eye to scaling them back.
Going forward, NAHB stands poised to vigorously defend the mortgage interest deduction and other critical housing and business provisions in the tax code as events unfold.
The NAHB Board of Directors has allocated resources to fight the anticipated assault on the mortgage interest deduction, and an integrated advocacy campaign is being developed in preparation for the Obama commission's final report to be released in December.
Along these lines, in the near future NAHB will introduce a new website that will provide essential data on the mortgage interest deduction and its importance to American consumers, and will facilitate member and consumer outreach to legislators.
Commentary
It should be clear from these proposals that homeownership, and particularly home building and ownership of new housing, is under attack from Washington. As NAHB works to defeat these proposals, the support of HBA members will be vital. Be ready to respond when asked and call your elected officials in Washington.
A discussion draft unveiled on Nov. 10 by Erskine Bowles and former Senator Alan Simpson, the co-chairs of President Obama's bipartisan Commission on Fiscal Responsibility and Reform, lists options to completely eliminate the mortgage interest deduction or limit it to primary residences and mortgages under $500,000.
Other recommendations would be adverse for the Low Income Housing Tax Credit (LIHTC), the deduction for real estate taxes for home owners, accelerated depreciation for rental housing, energy tax incentives and tax-exempt housing bonds. In addition, the proposals would result in significantly higher tax rates for capital gains and dividends.
However, none of these proposals has been formalized, and they are only listed as potential "options." Moreover, the overall plan, which includes many controversial recommendations on Social Security, health care, defense spending and other issues, must win support of 14 of the 18 commissioners in order for Congress to consider the package. This is a high hurdle and requires the support of both Republican and Democratic members of the commission.
The commission itself has no actual power to implement its official recommendations and many of the proposals put forth by the chairmen are unlikely to garner bipartisan support.
Reactions to the plan from both sides of the political aisle have varied, ranging from outright opposition to cautious interest.
A National Sales Tax and Devaluation of the Mortgage Interest Deduction
On Nov. 17, Pete Domenici, a former Republican Senate Budget Committee Chairman, and Alice Rivlin, former head of the Office of Management and Budget under President Clinton and a member of the president’s debt commission, released their own deficit reduction plan as co-chairs of the Bipartisan Policy Center’s Debt Reduction Task Force.
The Domenici-Rivlin plan to reduce America’s deficits would devalue the mortgage interest deduction by replacing it with a 15 percent refundable tax credit for anyone who owns a home. It would also eliminate several other tax rules related to housing, including the Low Income Housing Tax Credit, real estate tax deductions and deductions for second homes and home equity loans.
The proposal would further impose a new 6.5 percent national sales tax that would be applicable for new home sales and remodeling projects, but not for the purchase of existing homes. With the average nationwide price of a new home at $257,500, this plan would impose a whopping $16,738 tax increase on a typical new-home purchase and price more than three million households out of the new-home sales market.
While the Domenici-Rivlin and Bowles-Simpson proposals are sparking controversy across the political spectrum, it has become increasingly clear that policymakers are taking a close look at the mortgage interest deduction and other housing incentives with an eye to scaling them back.
Going forward, NAHB stands poised to vigorously defend the mortgage interest deduction and other critical housing and business provisions in the tax code as events unfold.
The NAHB Board of Directors has allocated resources to fight the anticipated assault on the mortgage interest deduction, and an integrated advocacy campaign is being developed in preparation for the Obama commission's final report to be released in December.
Along these lines, in the near future NAHB will introduce a new website that will provide essential data on the mortgage interest deduction and its importance to American consumers, and will facilitate member and consumer outreach to legislators.
Commentary
It should be clear from these proposals that homeownership, and particularly home building and ownership of new housing, is under attack from Washington. As NAHB works to defeat these proposals, the support of HBA members will be vital. Be ready to respond when asked and call your elected officials in Washington.
Monday, September 27, 2010
Poll Finds Voters Overwhelmingly Opposed Changing Mortgage Interest Deduction
Americans overwhelmingly oppose any action by Congress to tamper with the mortgage interest deduction, according to a new nationwide survey of likely voters commissioned by the National Association of Home Builders (NAHB). Nearly 80 percent support retaining federal tax incentives to promote homeownership, which have been in the tax code since the introduction of federal income taxes in 1913.
"These poll results show strong national voter support for keeping the mortgage interest deduction that cuts across gender, age, partisan, ideological, educational and regional lines," said Neil Newhouse, partner at Public Opinion Strategies, which conducted the survey. "Clearly, voters have a very strong connection to the home mortgage interest deduction and are not likely to respond well to efforts to reduce or eliminate it. In fact, voters overwhelmingly say they would be less likely to vote for a candidate for Congress who supported either eliminating or reducing the home mortgage interest deduction."
On the issue of tax reform, U.S. voters remain unwavering in their support of the mortgage interest deduction. When asked to rate the importance of preserving tax deductions in the current tax code, an overwhelming number, 81 percent, said it's important to keep the deduction of mortgage interest on a primary home, ranking it in a virtual tie with medical expenses (82 percent).
In addition, more than three-quarters of respondents (76 percent) cited the importance of keeping the deduction for state and local taxes, including property taxes. Furthermore, those renting their current homes also placed a high priority on preserving the mortgage interest deduction. In ranking the importance of current tax deductions, renters said this provision came in second at 71 percent, behind the deduction for medical expenses.
Public Opinion Strategies conducted the survey Sept. 9 through 12 to assess the public's attitude toward the mortgage interest deduction and the importance of homeownership.
"As the midterm elections draw near, voters are sending a resounding message to Congress and the Administration: Don't meddle with the mortgage interest deduction or other tax incentives that support homeownership," said NAHB Chairman Bob Jones, a home builder from Bloomfield Hills, Mich. "Voters strongly oppose any action to curtail or eliminate the mortgage interest deduction, even when they hear an argument that eliminating the deduction would help reduce the federal deficit."
Monday, August 30, 2010
Time Magazine Publishes Report Critical of Homeowership
In its Sept. 6 cover story, Time magazine launches an assault on homeownership, claiming that it "may have triggered the financial crisis," "contributed to the hollowing out of cities," and "fed America's overuse of energy and oil." The Case Against Homeownership appears only in excerpted form on the magazine's website, but should be hitting subscriber mailboxes this week.
NAHB responded to this inaccurate and misleading story with a blistering letter to the editor from Chairman Bob Jones that defends homeownership as the largest creator of wealth for American families and a critical source of stability for both home owners and the surrounding community. Meanwhile, NAHB continues to aggressively challenge this anti-homeownership message, which has already generated similar stories in other national and local media outlets. We are coordinating with the National Association of Realtors, which also reacted immediately with its own response to the Time story.
In addition, NAHB Public Affairs has developed numerous reports, articles and studies on the benefits of homeownership that are available to all of our members on www.NAHB.org. The Opportunity Knocks brochure also provides excellent arguments to help deliver the message that homeownership is still a great choice for many Americans.
Read excerpts of the report in Time by clicking here.
Read information at NAHB.org supporting homeownership.
NAHB responded to this inaccurate and misleading story with a blistering letter to the editor from Chairman Bob Jones that defends homeownership as the largest creator of wealth for American families and a critical source of stability for both home owners and the surrounding community. Meanwhile, NAHB continues to aggressively challenge this anti-homeownership message, which has already generated similar stories in other national and local media outlets. We are coordinating with the National Association of Realtors, which also reacted immediately with its own response to the Time story.
In addition, NAHB Public Affairs has developed numerous reports, articles and studies on the benefits of homeownership that are available to all of our members on www.NAHB.org. The Opportunity Knocks brochure also provides excellent arguments to help deliver the message that homeownership is still a great choice for many Americans.
Read excerpts of the report in Time by clicking here.
Read information at NAHB.org supporting homeownership.
Tuesday, August 24, 2010
The Push for Reducing Government Support for Homeownership
In Nations Building News, NAHB's weekly e-newsletter, NAHB details how advocates within the Federal Government are pushing to reduce Federal Government support for homeownership.
The primary target is the Mortgage Interest Deduction, which has long been the target of a variety of groups bent on reducing support for Federal homeownership support programs. Also targeted are the government sponsored enterprises (GSE) Fannie Mae and Freddie Mac, both of which make a market for securitizing mortgages, a vital function to a high level of homeownership.
At the "Conference on the Future of Housing Finance," criticism was heard that housing subsidies should be shifted to rental housing from homeownership and from higher-income to low-income beneficiaries.
Read the entire article by clicking here.
The primary target is the Mortgage Interest Deduction, which has long been the target of a variety of groups bent on reducing support for Federal homeownership support programs. Also targeted are the government sponsored enterprises (GSE) Fannie Mae and Freddie Mac, both of which make a market for securitizing mortgages, a vital function to a high level of homeownership.
At the "Conference on the Future of Housing Finance," criticism was heard that housing subsidies should be shifted to rental housing from homeownership and from higher-income to low-income beneficiaries.
Read the entire article by clicking here.
Monday, July 12, 2010
NAHB Study Evaluates Higher Density and Greenhouse Gases
A study commissioned by the National Association of Home Builders (NAHB) and conducted by Abt Associates showed that higher-density communities will only modestly alter travel behavior and therefore have a similarly modest impact on greenhouse gas emissions. The analysis was based on a review of 200 case studies on residential density and its relationship to travel behavior and climate change.
"Not everyone wants to, or can, live in a high-density community, and consumers continue to require a range of housing types and neighborhoods because of a complex set of interacting market, demographic, and other factors," Jerry Howard, President and CEO of NAHB, said. "Before government starts dictating how Americans should live and the types of communities they can live in, we should make sure that sound research validates that as a sensible approach," Howard said.
NAHB's study found that while much of the vast volume of research on the impact of development on greenhouse gases shows a link between higher density communities and the number of vehicle miles traveled, it is an oversimplification that higher density equals lower greenhouse gas emissions.
Read the entire study by clicking here and clicking here.
"Not everyone wants to, or can, live in a high-density community, and consumers continue to require a range of housing types and neighborhoods because of a complex set of interacting market, demographic, and other factors," Jerry Howard, President and CEO of NAHB, said. "Before government starts dictating how Americans should live and the types of communities they can live in, we should make sure that sound research validates that as a sensible approach," Howard said.
NAHB's study found that while much of the vast volume of research on the impact of development on greenhouse gases shows a link between higher density communities and the number of vehicle miles traveled, it is an oversimplification that higher density equals lower greenhouse gas emissions.
Read the entire study by clicking here and clicking here.
Friday, July 9, 2010
NAHB Study Demonstrates Value of Housing Tax Incentives
A new study by the National Association of Home Builders demonstrates that households across the economic spectrum benefit from housing tax incentives. This research counters the often-heard but erroneous claim that the mortgage interest deduction almost exclusively benefits high-income households.
The study, which was authored by NAHB tax economist Robert Dietz, Ph.D., supplements previous NAHB research regarding housing tax incentives, explores the problems with government methods of measuring the size of housing tax expenditures, and re-examines the income distribution of the mortgage interest and real estate tax deductions.
A multitude of descriptive statistics in the report demonstrate that the housing-related tax deductions, the mortgage interest and real estate tax deductions, strongly benefit not just average home buyers but also younger households who tend to be recent home buyers with larger mortgage debt. This is true in terms of aggregate amounts claimed on tax forms, average deduction amounts, and shares of taxpayer income.
The paper's conclusions suggest that proposals to change these deductions need to take into account the generational consequences, particularly with respect to first-time home buyers, as well as the impacts on modest-income households.
You can access the study for free by clicking here.
The study, which was authored by NAHB tax economist Robert Dietz, Ph.D., supplements previous NAHB research regarding housing tax incentives, explores the problems with government methods of measuring the size of housing tax expenditures, and re-examines the income distribution of the mortgage interest and real estate tax deductions.
A multitude of descriptive statistics in the report demonstrate that the housing-related tax deductions, the mortgage interest and real estate tax deductions, strongly benefit not just average home buyers but also younger households who tend to be recent home buyers with larger mortgage debt. This is true in terms of aggregate amounts claimed on tax forms, average deduction amounts, and shares of taxpayer income.
The paper's conclusions suggest that proposals to change these deductions need to take into account the generational consequences, particularly with respect to first-time home buyers, as well as the impacts on modest-income households.
You can access the study for free by clicking here.
Wednesday, July 7, 2010
NAHB Offers Brochure for Consumers
Now that the home buyer tax credit program has expired, it is important to emphasize to today's homeuyers all of the great reasons why now is a great time to buy a new home.
With this in mind, NAHB's popular virtual brochure for consumers "Opportunity Knocks" has been updated and is ready for home builders to download and use.
The brochure highlights the federal tax benefits of owning a home, the difference that even a small increase in interest rates can make on a monthly mortgage payment, and the solid value of homeownership over the long-term. It's available as a PDF file that NAHB members can download for free at www.nahb.org/homebuyerbrochure.
HBA members are encouraged to post this resource to your websites, and to print it for distribution in your sales offices.
With this in mind, NAHB's popular virtual brochure for consumers "Opportunity Knocks" has been updated and is ready for home builders to download and use.
The brochure highlights the federal tax benefits of owning a home, the difference that even a small increase in interest rates can make on a monthly mortgage payment, and the solid value of homeownership over the long-term. It's available as a PDF file that NAHB members can download for free at www.nahb.org/homebuyerbrochure.
HBA members are encouraged to post this resource to your websites, and to print it for distribution in your sales offices.
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