“The fundamentals today are financial fundamentals,” Everett Allen Greer, managing member of Greer Advisors in Los Angeles, said. “They have nothing to do with supply and demand. … It’s everything to do with who can get a loan and who can’t.”
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.”
NAHB’s Senior Officers and a cross-section of our members seized the opportunity this week to bring the builder’s viewpoint regarding ongoing challenges in the housing market to two of the nation’s most important policy-making organizations.
In a meeting on September 16with Fed Chairman Ben Bernanke and other top officials at the Federal Reserve Board, our members shared their first-hand accounts of the experiences they have had in trying to obtain financing for viable projects. They also voiced concerns about the impact that this problem continues to have on the fragile housing and economic recovery. The discussion was solely an information opportunity in which no promises were expected or received, but was nonetheless an important part of NAHB’s outreach to every possible regulator, bank agency, and legislator who has the ability to help restore the flow of credit to our industry.
On the same day, NAHB Senior Officers met with leadership and staff of Fannie Mae to discuss a variety of topics, including appraisals, NAHB’s position on GSE reform, single- and multi-family mortgage credit availability, the housing outlook, and builder problems in obtaining AD&C financing. Fannie Mae’s representatives expressed interest in working further with NAHB to develop improved appraisal and financing treatment for green building, and in hearing from NAHB multi-family members about financing challenges in different housing markets. Fannie Mae and NAHB agreed to continue to share information on emerging housing and housing finance issues.
NAHB members who attend this week’s Fall Board of Directors meeting in New York will get an update on these important discussions, as well as on upcoming meetings with other key stakeholders in housing finance.
For the second time this year, the South Carolina State Housing Finance and Development Authority has announced lower interest rates for its popular First Time Home Buyer Program. Effective immediately the State Housing Authority has lowered rates to 4.875 percent for borrowers in Categories I and II, which include borrowers earning 50 percent and above median income household income for the state. In addition, the authority has lowered rates to 4.750 percent for Category III borrowers who early less than 50 percent of the median household income and borrowers who are disabled. All categories offer up to $5000 down payment assistance.