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“I understand there’s a need for sensible regulation, but when you have overlapping regulations that send confusing signals, when you have the federal government, the state government, the local governments creating obstacles for home building, it is time to reduce those regulations.”
Following the address, Rayburn met briefly with President Bush. “After he said to me, ‘We really need to break down these barriers,’ I assured the President that we’ll do everything we can to help him accomplish this,” he said.
Rayburn told the President that NAHB is delivering to Housing and Urban Development Secretary Alphonso Jackson a task force report on how HUD can help break down some of these regulatory barriers at the national level. (To read a related story in this issue of NBN, click here.)
During his address, President Bush took the opportunity to voice his support for the deductibility of mortgage interest on income taxes. “I believe that the mortgage interest deduction enables more Americans to achieve the goal of homeownership,” he said. “It is an important part of our tax code.”
President Bush said that his Administration has sent to the Congress several initiatives designed to help increase the number of American families who can buy homes. Among them:
- The Homeownership Tax Credit, which would provide tax credits to developers or investors who build or substantially rehabilitate housing in rundown neighborhoods for lower-income home buyers. To reach the Administration’s goal of building seven million more affordable homes in the next 10 years, the President has asked Congress to pass this legislation, which would result in the construction or renovation of 40,000-50,000 affordably priced homes annually.
- The FHA Zero Downpayment program, which would remove the 3% downpayment rule for first-time home buyers with FHA-insured loans. The President noted that this could help as many as 150,000 people become home owners in the first year alone.
- A request for $2.7 billion in loan guarantees and $1.1 billion for direct loans to low-income borrowers who can’t get bank loans “will help thousands in rural communities across America achieve the dream of homeownership,” President Bush said.
Bush said that he has doubled funding for education and counseling services “to help first-time home buyers navigate the lending process, understand the fine print and avoid predatory lenders,” and his Administration has seen the creation of 1.6 million new minority home owners only two years after setting a goal of adding 5.5 million new minority households to the nation’s homeownership rolls by the end of this decade. The overall homeownership rate and the minority rate are at all-time highs, he said.
Noting that 63% of the members of NAHB are either subchapter-S or sole proprietorships who pay their taxes at the individual income tax rate, the President said that by providing tax-cut relief, “we helped our small businesses; we helped our home builders. We helped you with resources to build or grow and expand and hire more workers. By cutting taxes on dividends and capital gains, we encouraged savings and investment, which is crucial to your industry.”
To further help home builders, President Bush touted his plan to allow small businesses “to join together through association health plans so they can purchase insurance for their employees at the same discounts that big businesses are able to do.”
Early on in his remarks to the NAHB Board of Directors, the President singled out the volunteer work of Karen Kindron in the Columbus affiliate of Rebuilding Together, which helps low-income, elderly and disabled home owners obtain services such as weatherization and repair work. Since it was founded in 1988, he said that the organization has enlisted more than two million volunteers who have rehabilitated 87,000 homes and facilities.
The President also cited the leadership of builders in Florida’s hurricane recovery efforts. “I want to thank you for the good work that the home builders are doing for people of that state,” he told the NAHB board. “Home builders have collected donations of cash and building materials for families that have lost so much. They’ve established an online disaster contractor network to help put home owners in touch with licensed contractors and with government officials who can help those people that have been hurt by these storms.”
President Bush said that his grandfather was born in Columbus in 1895, where he built a home on Roxbury Road. “The home builder they hired did a good job,” he said. “The house still stands.”
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