2017 Residential Economic Issues and Trends Forum
During the National Association of REALTORS® 2017 Conference, NAR’s Chief Economist Lawrence Yun and real estate consultant Ken Rosen forecast 2018 at the Residential Economic Issues & Trends Forum.
“Despite considerable demand all year,” said Yun, “pending sales have lost a step in recent months because low supply is pushing prices higher and making homebuying less affordable in several parts of the country.”
No surprise there, but what can be done about it?
Rosen, who chairs UC Berkeley’s Fisher Center for Real Estate and Urban Economics, shared some policy ideas “on how to ensure more creditworthy households can enjoy the personal and financial benefits of owning a home.”
- Mortgage Availability
- Improve Access to Credit for Consumers
- Reducing Post-Foreclosure Lending Aversion
- Safe and Sustainable Future for Fannie Mae & Freddie Mac
- Affordability
- Down Payments Savings Program (tax-free Individual Housing Account)
- Graduated Payment Mortgages
- Shared Equity Products
- Lease Purchase Agreements (rent-to-own with a fixed-option price)
- Student Debt
- Standardized Mortgage Underwriting
- Student Loan Interest Deductions
- Student Debt Mortgages
- Public Relations Campaign Promoting Sustainable Homeownership
- Counseling Programs for Potential Homeowners
- Post-Foreclosure Targeted Assistance
- Reducing Regulatory Hurdles to Development
- Increasing New Home Construction
During a subsequent interview with Yun, NAR’s Director of Member Engagement Nobu Hata asked him about what’s happening in the housing market right now. Yun replied, “Overall, sales on the half-million-dollars and over (homes) this year are actually better than last year.”
But how might that be affected by the tax overhaul bill from House Republicans that cuts interest deductions from $1M to $500K on new mortgages and eliminates second home mortgage deductions?
“We are still trying to digest (the tax bill),” continued Yun. “On average, we’re looking at over $800 in additional taxes for homeowners because one cannot utilize mortgage interest deduction or property tax deduction, personal exemption and many other factors.
“If the tax reform harms the attractiveness of real estate and buyers say, ‘Time out! I’m going to look at other assets, not real estate’ – then things will be much weaker. It will be quite a harm to real estate.”
NOW is the time to tell Congress that any new tax code must protect middle-class homeowners.
Related story:
NAR forecasts existing-home sales growth in 2018 – Mortgage Professional America (Nov. 7, 2017) Tags: Fisher Center for Real Estate and Urban Economics, Ken Rosen, Lawrence Yun, mortgage interest deduction, Nobu Hata, tax bill, Tax Code