NAR commends passage of bills that bolster real estate

The National Association of Realtors Nov. 15 applauded the U.S. House of Representatives for passing legislation that will reduce barriers to homeownership and for approving the terrorism insurance conference report before adjourning for the year. These bills are both big victories for the real estate industry.

The Federal Housing Administration Downpayment Simplification Act of 2002, S 2239, now goes to President Bush for his signature. This legislation makes permanent the FHA downpayment simplification calculation, indexes the FHA multifamily loan limits to inflation using the Consumer Price Index, and repeals the scheduled increase of the Ginnie Mae guaranty fee. All three of these items were linchpins in NAR's legislative agenda to stimulate affordable housing opportunities for everyone.

"The FHA Downpayment Simplification Act will make it easier for families to calculate and come up with the proper downpayment on a home. This will help thousands of families overcome the financial barriers to first-time homeownership," NAR President Cathy Whatley said.

"Realtors applaud Congress and the administration for their commitment to making downpayments more affordable, accessible and easier to understand. As Realtors, we're committed to strengthening federal mortgage financing programs which have a proven track record of success in helping more families achieve the American dream of homeownership."

NAR also commended the House for passing the conference report for Terrorism Risk Protection Act, HR 3210. The Senate is expected to approve the conference report, and President Bush has made terrorism insurance a top priority and has promised to sign the bill.

This legislation will make the federal government the insurer of last resort for the next three years by covering 90 percent of the cost of a terrorist attack for losses over $10 billion to $15 billion.

The current shortage of adequate and affordable terrorism insurance has severely reduced and restricted commercial real estate transactions, making it increasingly difficult to operate or acquire properties, build new projects and find appropriate financing.

More than $15.5 billion worth of real estate projects in almost 20 states have been stalled or cancelled due to the ongoing lack of terrorism insurance, according to a recent survey, NAR reports.

"We are pleased that the House has heeded the president's call to pass the terrorism insurance conference report and resolve the terrorism insurance problems that have been severely hampering the real estate and construction industriesindustries that account for nearly one-third of our nation's gross domestic product," Whatley said.

"We expect the Senate to follow with their approval next week. This legislation will help jump start our economy by giving the green light to real estate and construction projects all around the country that had been previously stalled, which in turn will create new jobs. This is a major victory for our nation's homeowners, the real estate industry and the American economy alike."

While NAR applauded Congressional action on the housing and terrorism insurance bills, the association was disappointed that Congress failed to enact bankruptcy reform legislation.

When the 108th Congress convenes, NAR's agenda will center on renewing efforts to reform bankruptcy laws as well as maintaining the separation of banking and commerce, promoting favorable tax policies to bolster the economy, reducing barriers to housing opportunities, increasing the efficiency and effectiveness of the mortgage finance system and supporting new market initiatives to close the minority homeownership gap.