Article by Matt Dornic
If you’re worried about the future of home ownership in America, you have good reason. The nation’s economy is struggling. But it’s not just the rising unemployment rate (up to 9.2% in June 2011) that’s deferring home ownership for many. Some outlandish proposals on Capitol Hill are also weighing heavily on the hearts and minds of home owners, sellers, and potential buyers.
But despite financial woes, a decline in home prices (down 4.6% in May 2011 year over year, according to NATIONAL ASSOCIATION OF REALTORS®’ stats), and a ludicrous legislative attack, a new poll suggests that the dream of owning a home is still alive and well in the United States. According to research conducted by CBS News and The New York Times, a whopping nine out of 10 Americans say home ownership is still an important goal. More than half of those surveyed described it as “very important.” Did you hear that, Congress?
With so much enthusiasm for home ownership, it’s tough to understand how some lawmakers are blatantly disregarding their constituents and proposing legislation that would further cripple the market. According to the CBS/NYT poll, almost half of Americans believe the government should be doing more to improve the housing market. But the hard reality is that some in Washington are putting the American dream out of reach.
Federal regulators, for instance, in an attempt to tighten lending standards, have put forth a proposal that would punish home buyers who put down less than a 20% downpayment by hiking their interest rates almost two percentage points. The proposal would create a high downpayment hurdle for first-time and low-income home buyers and make refinancing much more expensive for credit-worthy home owners.
If you agree that 20% down is just too high for hard-working, creditworthy Americans, send a message to the U.S. Department of Housing and Urban Development, which is accepting comments until Aug. 1.
Another important revelation from the poll is that nine in 10 of those surveyed say it’s important to maintain the mortgage interest deduction; six in 10 call the MID “very important.” Yet the President and some members of Congress have suggested repealing the longtime tax credit, which would mean an annual hit of more than $3,000 to the average itemizing home owner. So why is the government ignoring the voices of those they were elected to represent?
America has spoken: The government needs to take note, advance home ownership, and abandon proposals that would hinder the housing market. If our representatives won’t listen, the 2012 elections are a great opportunity to find some who will.
What do you think of the various federal efforts to tighten downpayment rules and reduce home owner tax breaks?