Inman

The presidential housing platform

The National Association of Home Builders, a trade association whose members employ about 8 million workers, asked leading presidential candidates, President George W. Bush and U.S. Sen. John Kerry, D-Mass., about their political stances on various housing issues.

Their responses were featured this week in an edition of Nation’s Building News Online, the association’s weekly online news publication. The following are excerpts from those questions and responses:

NAHB: Housing has been a major contributor to the nation’s economic growth in recent years. Looking ahead, how critical is housing’s performance to the nation’s economic recovery? What specifically would you do to ensure that housing production and home sales continue to lead the economy forward?

BUSH: Home ownership rates have soared to record levels in recent months, further evidence of a growing economy. By lowering taxes and laying the foundation for companies to create new jobs, we are contributing to the strength of the housing market and the economy as a whole. Tax relief has left Americans with more money to put toward buying a home or paying the monthly mortgage. In addition, I have pursued an aggressive home-ownership agenda that includes the goal of creating 5.5 million new minority homeowners by the end of the decade through a variety of proposals to assist low- and moderate-income families.

To meet this goal, I signed into law the American Dream Downpayment initiative, which authorizes $200 million a year to assist an estimated 40,000 low-income families with down-payment funds. In this year’s budget, I proposed the Zero Downpayment Initiative, which would eliminate the statutory requirement of a minimum 3 percent down payment for Federal Housing Administration-insured single-family mortgages for first-time home buyers. Preliminary projections indicate that the new FHA mortgage product would generate about 150,000 home buyers in the first year alone. I also proposed to triple funding for self-help programs that offer homeownership opportunities to families willing to contribute their own “sweat equity,” and I have increased funding for housing counseling programs.

KERRY: Housing has been a pillar of strength for our economy, even while many other industries have been experiencing difficulties. We must ensure that our housing sector remains strong while we work to create new jobs and growth in our economy.

As Ranking Member of the Senate Banking Committee’s Housing Subcommittee for a number of years, and as a current member of the Senate Finance Committee, I understand the important role housing plays in developing our economy. That is why I have worked to promote the whole spectrum of housing opportunities, including: the preservation of existing affordable housing; the construction of new affordable housing; protecting and expanding the Low Income Housing Tax Credit; introducing legislation to increase home ownership through the rehabilitation of existing homes and the construction of new homes; protecting and expanding the multifamily and single-family FHA programs; and producing elderly and assisted housing.

NAHB: Where do you stand on the debate over how best to regulate Fannie Mae and Freddie Mac?

BUSH: They are in need of a regulatory structure that is worthy of their considerable size, complexity and importance. And they must remain focused on their special public mission. My Administration is committed to GSE reform consistent with these twin goals: increasing homeownership opportunities for low- and middle-income Americans and ensuring the long-term strength and resiliency of the housing finance system. I have called on Congress to create a new regulatory regime that establishes a single financial regulator with the full range of supervisory and enforcement powers that are comparable to other world-class financial regulators.

KERRY: I support maintaining the GSEs’ government-sponsored status because housing holds a special place in both our economic and social policy in this country. I am, however, concerned about recent governance and accounting problems at Freddie Mac. I would work with Congress and the top experts to carefully examine these issues and develop legislation that provides for strong, effective supervision and regulation of Government Sponsored Enterprises within a framework that assures their safety and soundness. We must also increase the focus of GSEs on affordable housing.

NAHB: While the housing market has performed very well in recent years, it is becoming increasingly difficult for many first-time buyers and working families to buy or rent homes in the communities where they work. How do you view today’s housing affordability problem, and what specifically would your Administration pursue to help close the gap between those who can afford a home and those who can’t?

BUSH: I have proposed a five-year Single-Family Affordable Housing Tax Credit. The tax credit is for up to 50 percent of the costs of constructing or rehabilitating affordable homes, provided they are sold to home buyers with incomes of not more than 80 percent of area median income. Tax credits awarded in the first five years will result in an additional 200,000 affordable single-family homes becoming available through construction or rehabilitation. I signed into law the American Dream Downpayment initiative, which authorizes $200 million a year to assist an estimated 40,000 low-income families with down-payment funds.

In this year’s budget, I proposed the Zero Downpayment Initiative which would eliminate the statutory requirement of a minimum 3 percent down payment for Federal Housing Administration (FHA)-insured single-family mortgages for first-time home buyers. Preliminary projections indicate that the new FHA mortgage product would generate about 150,000 home buyers in the first year alone.

KERRY: Today, too many low- and moderate-income families living in urban and rural areas across our nation have not been able to share in the dream and benefits of home ownership due to the lack of available housing or the high cost of the housing that is available. I have made a number of proposals in the past to increase home ownership.

For example, I have previously introduced legislation, the First Time Homebuyer Affordability Act, which would allow families to borrow up to $10,000 from their IRAs (or from their parents’ IRAs) for a down payment on their first home without paying any taxes. I have also introduced legislation to encourage the construction and rehabilitation of for-sale homes that will both create new opportunities for low-income home buyers and help revitalize distressed communities. Finally, I have strongly supported efforts to increase FHA loan limits to help more families become first-time home buyers.

Source: Nation’s Building News Online, official online weekly newspaper of the National Association of Home Builders.

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