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Appearing at the National Housing Center on March 16 at the start of the annual NAHB Legislative Conference, Reps. Brad Miller (D-N.C.) and Patrick Tiberi (R-Ohio) pledged to work with home builders to help restore credit for housing production and get the industry back on track.
“Federal regulators are putting pressure on community banks to ratchet back,” said Rep. Miller. “There is a reflexive unwillingness to lend. That is killing jobs and killing the recovery.”
Rep. Tieri said he supported legislation — the Home Construction Lending Regulatory Improvement Act of 2011 — that was expected to be introduced shortly by Rep. Gary Miller (R-Calif.) as a solution for addressing the regulatory obstacles preventing the nation’s home builders from having access to the credit they need.
Builders attending the conference called on House members to become original co-sponsors of the bill and they urged the Senate to introduce a companion measure.
Tiberi, who chairs the House Ways and Means Subcommittee on Select Revenues Measures, also told conference participants that there is now a window of opportunity for comprehensive tax reform that will improve the environment for their businesses.
“We need to reduce rates, encourage economic growth and make sure we don’t penalize entrepreneurship and investment,” said Tiberi. “If we can get the Miller bill passed and change the tax code, we can get housing back on track.”
Rep. Brad Miller told builders that in the last Congress he had championed legislation (H.R. 6191) to address the small business lending concerns of residential home builders and that he is continuing his efforts to open the flow of credit for housing production.
“It doesn’t make any sense to call in performing loans and make them non-performing loans,” he said.
In another area of concern to NAHB, he said that a provision of the Dodd-Frank financial reform legislation requiring lenders to keep 5% of their loans as “skin in the game” would make lenders more risk-averse.
“We need to make sure we don’t overreact and require a 20% or 30% downpayment for people who buy a home,” he said. “They won’t be able to afford it.”
As Congress debates the future of Fannie Mae and Freddie Mac, Miller said that lawmakers need to understand “what’s important concerning a secondary market and not simply turn that over to the ‘Titans of Wall Street.’”
“There needs to be a continued federal role in housing finance and we need an affordable 30-year, fixed-rate mortgage as an option,” he added.
On tax-related concerns, Tiberi, who was instrumental in helping enact the home buyer tax credit in 2009, told builders that they should stress the importance of the mortgage interest deduction and Low Income Housing Tax Credit in their meetings with lawmakers.
Emphasizing major differences in the quality of public housing and low-income communities produced by private investors, Tiberi said, “What the private sector has done for low-income housing is phenomenal. Those homes don’t look like low-income housing. You need to help us make the case to protect and expand this program.”
Miller and Tiberi each highlighted the important contribution of housing and homeownership to maintaining a vibrant economy and strong communities.
The housing and economic downturn “was not caused by a policy that encourages homeownership,” said Miller. “That’s not a lesson we should take from this situation. The problem was loans that trapped people in debt. Our society works better when people own their own homes. We should encourage homeownership.”
“It’s so important to get housing back on track,” added Tiberi. “Housing has a multiplier effect on the economy. The number of jobs that go into a home that impacts our economy is huge. I am a big believer in homeownership as being part of the American dream.”