SENATE PASSES HOUSING STIMULUS BILL, REALTORS AND BUILDERS URGE HOUSE TO QUICKLY FOLLOW SUIT
July 11, 2008 - The National Association of Home Builders (NAHB) today applauded the Senate for voting overwhelmingly to pass badly needed housing stimulus legislation and called on the House to move quickly to complete action on the bill to address the faltering housing market and economy.
“The Senate action hasn’t come a moment too soon,” said Jerry Howard, executive vice president and CEO of NAHB. “Each passing day brings more layoffs, more foreclosures and more fear. This legislation will help get home buyers back into the marketplace, stabilize house prices, stem the rising tide of foreclosures and restore confidence in our housing finance system. There’s no time to waste. Congress must finish the job now and pass this bill so that Americans can get some relief.”
H.R. 3221, the American Housing Rescue and Foreclosure Prevention Act, contains several provisions that would help put the economy back on track, save jobs and restore confidence. The bill would:
- Create a temporary, first-time home buyer tax credit for the purchase of any home. This would stimulate the housing market, eliminate excess inventory, relieve downward pressure on house prices and bring otherwise-qualified home buyers back into the market.
- Establish a more effective and balanced regulatory system for the housing government sponsored enterprises (GSEs) – Fannie Mae, Freddie Mac and the Federal Home Loan Banks. It would also permanently increase the GSE’s conforming loan limits up to $625,500, making home loans more affordable in high-cost areas.
- Give the Federal Housing Administration (FHA) greater flexibility to respond to the needs of borrowers, help more working families become home owners, provide a viable alternative to the subprime market and play a greater role in stabilizing the mortgage markets. The maximum FHA-insured loan would be permanently increased up to $625,500, helping prospective buyers to purchase homes in more markets across the country.
- Provide a temporary increase in state tax-exempt housing bond authority to help struggling home owners refinance their subprime loans and to increase access to affordable mortgage credit.
- Enhance the Low Income Housing Tax Credit (LIHTC) and tax-exempt housing bond programs to increase their effectiveness in addressing the nation’s continuing affordable housing needs.
- Expand the FHA program to provide additional authority to help at-risk borrowers refinance with viable mortgages and prevent further foreclosures. The Congressional Budget Office estimates this could help as many as 400,000 struggling home owners to stay in their homes.
The legislation was stalled for weeks by Sen. John Ensign (R-Nev.), who doggedly insisted on attaching an amendment to add $8.2 billion in energy tax break extensions to the package. Senate leaders surmounted those delaying tactics and were able to bring the bill to a vote early this evening.
The bill now goes to the House. While House and Senate lawmakers largely agree on the core provisions of the bill, the House is likely to make some modifications. The Senate will then need to approve any changes made by the House before the legislation can be sent to the President to be signed into law.
