
I received an email today from my Congressman outlining what the new housing plan means for the economy. From Tennessee Congressman Bart Gordon (who by the way hosted my daughter's Girl Scout troop on our visit to Washington):
The
stimulus legislation passed by Congress updates the existing $7500 first time homebuyer tax credit, removing
the repayment requirement and expanding the credit to $8,000. This wasn't the $15,000 tax credit for
all new home purchases that I urged my colleagues to include in the final bill, but it provides a basis
for growth at a time when the housing market has stagnated.
Now efforts to provide additional assistance
that the stimulus bill has been signed into law, I will redouble my
to your industry. You are the cornerstone of our economy, and no recovery plan will be successful without
significant improvement in the housing industry. With this in mind, I am co-sponsoring H.R. 600, the
Down Payment
Assistance Reform Act of 2009, legislation reviving the down payment
assistance program. I will be working with my colleagues to promote a House version of Senator Isakson's
$15,000 homebuyer tax credit. I will also be reaching out to professionals in the real estate industry,
from homebuilders, to realtors, to bankers, for suggestions on how Congress can be of assistance.
I
am also optimistic that reforms to the Troubled Assets Relief Program (TARP) proposed by Treasury Secretary
Geithner will provide much needed liquidity to the housing market. Among the major provisions of the
Treasury plan is an expansion of a Federal Reserve's Term
Asset-Backed Loan Facility (TALF) program to include commercial real estate.
TALF is designed to increase credit availability and support economic activity by creating new consumer
and small business securities with AAA ratings that investors can purchase with confidence. By expanding
TALF to include high quality commercial real estate loans, the program would be a source of funding to
purchase new, highly-rated commercial real estate securities, injecting much needed capital into the
housing market.
The
Treasury plan will also remove bad assets from banks, giving them the flexibility to resume lending.
Stronger accountability measures will be in place, forcing financial institutions to disclose how TARP
funds have led to increased lending. While more details are needed on the mechanics of these proposals,
I believe the ideas outlined by Secretary Geithner are sound, and will help restore the market.
I am reprinting his email because it explains somewhat how the stimulus legislation will work. As a Realtor, I'm calling all the buyers I know who are on-the-fence to encourage them to consider 2009 as the year to buy.
Through this, however, my only concern (as voiced by a reader on my community site) … will this encourage people who aren't qualified to buy a home to jump in? I'm hoping the qualification standards will be rigid so in three or four years we won't fall back into this mess.
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