Stimulus Package Needs To Help Minneapolis Duplexes

The stimulus package introduced by the U.S. House of Representatives and guided by president elect Obama‘s administration proved somewhat disappointing for the real estate sector.

Both the National Association of Realtors (NAR) and the National Association of Home Builders (NAHB) have lobbied for a broad expansion of tax credits to stimulate the housing market.

Realtors have repeatedly asked Congress to simply expand the $7500 first time home buyer tax credit; not only making it available to all home buyers, but also eliminating the requirement that it be repaid. The Realtors association believes this modification would be enough to create an additional 555,000 in sales in the next two years.

Meanwhile, NAHB has asked representatives for a much more aggressive approach. They have asked Congress to consider offering a non-repayable tax credit of up to $22,000 for all purchasers this year.

Last week’s House version of the stimulus package, however, simply made the first time home buyer tax credit non-repayable.

However, NAR has expressed support for the TARP Reform and Accountability Act (H.R. 384) introduced by Chairman Barney Frank last week. This bill includes many of NAR’s recommendations for the remaining $350 billion in bailout money earmarked by Congress last fall. Key provisions include mortgage buy-downs to reduce interest below prevailing rates, increased foreclosure mitigation and prevention efforts, and liquidity in mortgage markets.

The U.S. Senate has yet to introduce its version of the stimulus package, with any differences between the two chambers brokered and resolved before the package’s anticipated passage in mid to late February. This leaves ample time for all of us to contact our Congressional representatives and encourage them toward package modification.