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.
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.
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 2.99 percent for those who purchase a home in 2009.
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.
Government Affairs Director
Home Builders Association of the Central Coast