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Housing Stimulus is the Key to Unlocking America's Economy
Are you frustrated not being able to close deals because of frozen credit markets? As REALTORS, we know that the current economic crisis is the result of problems in our nation's housing and mortgage markets. To Unlock America's Economy it is imperative that Congress take action and restore consumer confidence in homeownership. We are calling on Congress to stabilize housing and real estate by making affordable mortgages available and stemming foreclosures. Housing has always lifted our economy out of past economic downturns. Revitalizing the housing market is the solution once again.
Learn More About NAR's Housing Stimulus Plan
Dear [ Decision Maker ] , The current economic crisis is the result of problems in the nation's housing markets. Efforts to boost the overall economy will be wholly ineffective if the Economic Stimulus bill that goes to the President does not include provisions focused on stabilizing real estate markets. Both the House and Senate versions include provisions that are consistent with a housing plan that Realtors have advocated for several months. A few more changes are needed. Provisions offered by the National Association of Realtors that must be included are: *A tax credit available to all homebuyers. *Permanent FHA, Fannie Mae and Freddie Mac loan limits that match the levels enacted in 2008. *Increased resources for foreclosure mitigation efforts to stem the flood of foreclosures. Housing has always lifted our economy out of past economic downturns. Let's get housing moving now so that the economy can recover. Please support the inclusion of these critical provisions in any economic stimulus bill sent to the President. Thank you for your hard work.
Sincerely, |
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| Background Information |
Congress is debating the America Recovery Reinvestment Act, the latest in a series of economic stimulus measures considered by the House of Representatives and Senate. The Senate is expected to approve its bill the weekend of February 7th. Differences in the versions of the bill will then be worked out and considered the week of February 9th.
A previous economic stimulus bill, the Emergency Economic Stabilization Act of 2008, was a good first step towards stabilizing our nation’s economy. Unfortunately, a number of the Act’s provisions have not proven to be as useful at stabilizing the nation’s housing markets as envisioned.
NAR is urging Congress to include the following provisions in the economic stimulus legislation being debated this week:
- Include a $15,000 home buyer tax credit available to all buyers, eliminate repayment requirements and extend the credits availability thru 2009. The credit's limited availability, repayment requirement and limited timeframe severely limit the credit's use and effectiveness.
- Restore the FHA, Fannie Mae and Freddie Mac loan limits to their 2008 level and make them permanent. New rules for 2009 reduced the FHA and GSE limits in many communities nationwide. Now is not the time to limit mortgage affordability.
- Provide increased resources for foreclosure mitigation efforts. Stemming the flood of foreclosures is necessary to stabilize housing prices, stave off the problems associated with vacant properties, and allow families able to handle a properly underwritten and "non-toxic' loan stay in their homes.
About Foreclosure Mitigation
NAR believes additional resources are needed to help American families keep their homes, and stabilize neighborhoods, and help our economy recover. When people lose homes to foreclosure, communities, the housing market and our economy all suffer.
As home values continue to decrease in many markets and job losses escalate, homeowners needing to refinance their mortgage or sell their home are left with few options. As a result, distressed sales — foreclosures and short sales — accounted for 35 to 40 percent of transactions in the last quarter of 2008.
Unfortunately, a number of the Act’s provisions have not proven to be as useful at stabilizing the nation’s housing markets as was first thought.
NAR is urging Congress to include the following provisions in the economic stimulus legislation being debated this week:
There are many ways to prevent foreclosure. Some government efforts need to be reformed and provided additional resources.
- The Hope for Homeowners program is well intentioned to help troubled homeowners refinance into a safe, affordable FHA loan. However, it needs significant reforms to encourage lenders to participate, provide options to homeowners, while safeguarding the risk to the taxpayer. NAR supports initiatives that will make this foreclosure prevention tool more effective. In addition, we urge Congress and the Administration to reinstate the FHASecure program providing another alternative that will allow homeowners who are delinquent to refinance into an FHA loan.
- States have been provided monies under the Community Development Block Grant program to help address the foreclosure problems and provide for neighborhood stabilization. This money needs to be augmented and used to leverage resources to prevent foreclosure and revitalize neighborhoods.
- Financial institutions receiving TARP money should be held accountable for carrying out foreclosure mitigation programs.
Action Needed: Additional resources for foreclosure mitigation efforts at the Federal, State and Local level should be included in any economic stimulus package signed by the President.
