What are the most pressing issues in housing policy today?
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It’s no secret our nation’s housing markets remain depressed and continue to suffer. While no one thought the crisis would carry on so long, markets are slowly recovering and are in need of immediate policy solutions to address the myriad challenges in order to stabilize housing and support an economic recovery. The National Association of REALTORS® (NAR) has long maintained that the key to the nation’s economic strength is a robust housing industry.
At a recent conference titled New Solutions for America's Housing Crisis, policy leaders, industry representatives, Members of Congress, thought leaders and the media got together to present ideas and make actionable recommendations intended to stimulate the growth necessary for a sustained recovery in housing and extend an ensuing positive effect on job creation and the broader economy. Hosted by the Progressive Policy Institute and the Economic Policies for the 21st Century (e-21), NAR was proud to participate in this conference and develop a five-point housing solutions plan, which was submitted to the administration on October 24, to help reenergize housing markets and spur the economic recovery.
The five-point plan urges legislators and regulators to oppose proposals that could put the nation’s housing market recovery at risk. This includes revising the unnecessarily high down payment requirements of the proposed Qualified Residential Mortgage exemption; restoring higher mortgage loan limits supported by the Federal Housing Administration and the government-sponsored enterprises (GSEs); and preserving home ownership tax benefits, including the mortgage interest deduction.
The plan recommends that lenders and the government take more aggressive steps to modify loans and approve short sales to help reduce high foreclosure inventory levels and restore vitality to communities and neighborhoods. It also calls for changes to rehabilitation and investor financing programs, which will help private capital return to the mortgage markets and foster new demand among responsible homebuyers. This would also help reduce the high inventory of foreclosed homes and stabilize home prices.
In addition, the plan recommends that the federal government continue to play a role in the secondary mortgage market to support the use of long-term, fixed-rate mortgage products and ensure a continual flow of mortgage capital in all markets under all economic conditions. NAR believes the recent proposals calling for the full privatization of GSEs Fannie Mae and Freddie Mac should be rejected, because private firms will focus on generating revenue rather than on the best interests of consumers or the nation’s housing market, making homeownership unaffordable for many Americans. Finally, the plan urges the White House to move housing to the front of the nation’s domestic agenda.
The recovery of the broader economy depends on housing. The last two and a half years have shown that, with housing prices bumping along the bottom, a robust economic recovery will remain exceedingly difficult.
Joseph M. Ventrone is Vice President of the National Association of Realtors' Regulatory and Industry Relations Department.
Welcome to the BPC Housing Commission expert forum! This forum is intended to foster interactive and substantive discussion about pressing housing issues. Each month contributors from different parts of the housing sector will be invited to respond to a discussion topic. Guest posts will feature prominently on BPC's website, as well as be shared regularly with Housing Commissioners to help inform their work.
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Expert bloggers are not members of the BPC Housing Commission. Any views expressed on this forum do not necessarily represent the views of the Housing Commission, its Co-Chairs, or the Bipartisan Policy Center.