With our nation in the worst economic crisis since the Great Depression, Congress must be willing to take bold, decisive action to spur a housing and economic recovery. Unless we halt the slide in home prices, the nation’s housing and economic woes will grow even worse. This is why a robust housing component must be an integral part of the economic stimulus package the incoming Obama Administration and new Congress support.
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A failure to stem the decline in home values and jump-start home sales will result in more foreclosures, more problems with troubled mortgage assets, and an increasing inventory (already at record levels), which will drag down property values even more.
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To break this downward spiral, we need to get skittish home buyers back into the market. To stimulate demand, Congress should enact a meaningful tax credit between $10,000 and $22,000 to all qualified home buyers, coupled with an aggressive interest rate buy-down program to as low as 2.99Â percent for those who purchase a home in 2009.
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These measures will stabilize home prices, prevent future foreclosures, restore consumer confidence and start creating jobs. Congress enacted similar policies during the mid-1970s economic downturn. It worked then and can work again.
Jerry Bunin
Government Affairs Director
Home Builders Association of the Central Coast
This article appears in Jan 1-8, 2009.