An innovative homeownership tax credit bill introduced in the House by Reps. Tom Reynolds (R-N.Y.) and Ben Cardin (D-Md.) that would spur the production of affordable housing and create new jobs received the enthusiastic backing of the National Association of Home Builders.
H.R. 1549, the “Renewing the Dream Tax Credit Act,” is sound public policy and makes good economic sense, said NAHB President David Wilson, a custom homebuilder from Ketchum, Idaho.
“When enacted, the legislation is expected to stimulate the construction of 50,000 new or rehabilitated homes each year and create 120,000 new jobs annually,” he said.
Modeled after the successful Low Income Housing Tax Credit - which has mobilized private investment in more than one million rental apartments since 1987 - the measure would provide developers and investors with a tax credit of up to 50 percent of the cost of constructing a new home or rehabilitating an existing property.
For the fifth consecutive year, the homeownership tax credit was also funded in the Bush Administration’s proposed annual budget, and the legislation received overwhelming bipartisan support in both the House and the Senate during the 108th Congress.
Nearly 14 million households spend more than half of their income on housing or live in seriously substandard conditions. And in spite of this overwhelming need, very little new construction or substantial rehabilitation of owner-occupied homes occurs today in lower-income communities. This is mainly due to the cost of developing such housing, which typically exceeds the maximum feasible sales price of the property in these areas.
“There’s a very good reason that this legislation garnered more than 300 House cosponsors in the 108th Congress,” said Wilson. “The tax credit has the potential to bring the American Dream home for tens of thousands of working families. The nation’s homebuilders are urging all House members to cosponsor this vital measure.”