Category Archives: Tax Credits

New Polling, Myth-Busting Emphasize Importance of MID

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With Congress poised to continue the debate on ways to accomplish comprehensive tax reform in the next several months, NAHB’s economists last week set their sights on reminding lawmakers about the critical importance of the mortgage interest deduction (MID) as a middle-class tax provision that families depend upon to achieve homeownership. Looking at a variety of common myths about the deduction, they set the record straight on who benefits from it, what the consequences of repealing it would be, and who supports it — among other important questions. As one example, they explained that eliminating the MID would lead to a reduction in demand for housing by raising taxes on prospective buyers. That lower demand would lower home values for existing home owners, and in fact, just a 1% decline in home prices would result in a loss of $185 billion in wealth for American households. Ramp that up to a 6% decline, and you’re looking at $1 trillion in household net worth being wiped away. Our economists also addressed the issue of second homes that qualify for the MID, which critics contend are primarily large vacation homes owned by wealthy individuals. The truth is that rules relating to second homes often apply to situations that do not involve a vacation home at all, but rather a home that a family purchases before being able to sell their existing one, or a home that’s under construction.

  • Recent Polling Confirms Our Messages on the MID

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A new survey confirms the broad base of support the MID holds among the public, which is something that lawmakers will have to take into account in any negotiations regarding the future of this key incentive. The United Technologies/National Journal Congressional Connection Poll asked respondents to rate the importance of various tax rules. Results indicated that 61% of respondents believe it is ”very important” to keep the MID, with 86% of individuals saying it is either “very important” or “important.” This placed the MID at the top of the list, behind only tax preferred retirement accounts, which scored a 63% “very important” ranking, and ahead of  other popular tax rules including the employer paid health insurance exclusion (59%), the charitable giving deduction (39%), and the preferred rates on capital gains and dividends (27%). These results are consistent with prior independent polling conducted for NAHB last year.
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  • New Research Adds Even More Fuel to the Fire


NAHB’s economists have also written this week about a new macroeconomic analysis by the Tax Foundation that should give policymakers pause about using the MID as a way to pay for tax reform. The report’s findings are consistent with arguments NAHB has raised regarding other reform proposals that fail to account for the importance of this tax incentive for building wealth and promoting growth. Specifically, the report finds that eliminating the MID to pay for individual income tax rate cuts would contract the economy.

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Looking for Land? FDIC Selling Lots and Acreage in Many States

Going forward, NAHB will continue to aggressively defend the mortgage interest deduction as well as other critical housing incentives within the U.S. tax code, including the Low Income Housing Tax Credit that is one of the most successful initiatives ever for providing affordable rental housing in this country.  These properties include improved and unimproved land as well as single-family, multifamily and commercial sites that the FDIC is looking to sell. To view a current list of available properties, click here and select the property type, state and city in which you are interested.


Choose from more than 400 house plan designs that we offer in a wide range of styles and sizes.  Some of our more popular house designs include European-inspired Georgian and palladian homes, English manor house plans, Tuscan-style Italian villas, French chateaux, and colonial house plans.  Our Tuscan-style villas range from 1800 to 14,814 sf, and newport classic house designs range from 1500 to 5000 sf. Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world.  Please feel free to search our house designs offered.  Our plans have been built around the globe, from Canada to Dubai, and one could be just for you!

Check out today’s plan pictured above, Archival Designs‘ Award Winning Luxury House Plan, Cordelia.


Data Shows State-by-State Impacts of MID on Middle Class

As debate over tax reform ramps up in Congress, NAHB is emphasizing the critical importance of the mortgage interest deduction (MID) to American families nationwide, and the many reasons that lawmakers should leave this key homeownership incentive intact.

To help further NAHB’s efforts in this direction, our economists recently took a look at IRS data that helps illustrate the importance of the MID to the middle class in individual states across the country. It’s understandable that MID claims will vary across different states, depending on such factors as house prices and other costs of living, household incomes and tax items such as property taxes or state income/sales taxes — all of which help determine whether a home owner claims the standard deduction. And indeed, the IRS data shows that the share of taxpayers who both claimed the MID on their 2010 federal income tax return and reported less than $200,000 in adjusted gross income was somewhat smaller in high cost states such as New York and California, where incomes tend to be higher. Even so, compared to the 91% of taxpayers nationwide who had adjusted gross incomes of less than $200,000 and claimed the MID in 2010, states with the lowest percentage of such taxpayers were still in the 87%-and-above range.

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April Webinars Spotlight Green Building/Green Remodeling

2012 NGBS: An Overview of What’s New
April 3, 2:00 p.m.-3:00 p.m. ET

In its first four years, the ICC 700 National Green Building Standard™ (NGBS) has been transforming the residential marketplace by providing single- and multifamily builders, remodelers and land developers with ANSI-approved guidance on going green. The 2012 version of the NGBS promises to have an even greater impact. This webinar will look in-depth at the changes that affect the single-family portion of the rating system.

Speakers: Vladimir Kochkin, director of applied engineering, Home Innovation Research Labs; Matt Belcher, Verdatek Solutions, LLC

Presented by NAHBGreen


Building Green with Structural Insulated Panels
April 10, 2:00 p.m.-3:00 p.m. ET

Energy conservation plays a major role in designing and building sustainable homes. Builders can achieve the most energy savings through a high-performance building envelope, such as structural insulated panels (SIPs). SIPs are an advanced prefab building system allowing builders to meet the energy, resource efficiency and indoor air quality metrics of today’s green building rating systems at less cost. This webinar covers the basics of SIP construction’s sustainable attributes, such as thermal performance, resource efficiency and life-cycle analysis.

Speakers: Frank Baker, director, PFB Corp/Insulspan; Bill Wachtler, director, Structural Insulated Panel Association (SIPA)

Presented by NAHB Building Systems Councils


2012 National Green Building Standard: Remodeling Provision Defined
April 17, 2:00 p.m.-3:00 p.m. ET

The 2012 edition of the ICC 700 National Green Building Standard™ (NGBS) includes expanded options exclusively for remodelers to certify bath, kitchen and basement remodels and additions as well as whole-house remodels. In this session, the speakers will discuss the ins and outs for certifying remodels. The speakers will also explain how the NGBS’s new streamlined format will be simpler for remodelers and home owners to understand and use.

Speakers: Michelle Desiderio, Home Innovation Research Labs; Paul Sullivan, CGR, CAPS, CGP, The Sullivan Company, Inc.

Presented by NAHB Remodelers

Today’s House Design Photo is that of Archival Designs’ Aspen Creek.


Choose from more than 400 house plan designs that we offer in a wide range of styles and sizes.  Some of our more popular house designs include European-inspired Georgian and palladian homes, English manor house plans, Tuscan-style Italian villas, French chateaux, and colonial house plans.  Our Tuscan-style villas range from 1800 sf to 14,814 sf, and the Newport classic house designs range from 1500 to 500o sf.  Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world.  Please feel free to search our house designs offered.  Our plans have been built around the globe, from Canada to Dubai, and one could be just for you!

Pending Home Sales Increase to Highest Level Since 2010 Home Buyer Tax Credit

The Pending Home Sales Index, a forward-looking indicator based on signed contracts, increased 2.4 percent in July 2012 to 101.7 from 99.3 in June. The July 2012 PHSI was 12.4 percent higher than the same period a year ago. The PHSI is at its highest level since April 2010 when the home buyer tax credit was about to expire.

The National Association of Realtors (NAR) reported that the July PHSI was up in all regions but the West. The year-over-year increases were 13.4 percent in the Northeast, 20.2 percent in the Midwest, 15.6 percent in the South and 1.3 percent in the West. July new home sales also declined slightly in the West from the previous month.

If contracts closed at the same time they were signed, this graph would be the correspondence between sales and the PHSI. So the PHSI is a good indicator of what will likely happen to existing home sales when the contracts close in coming months. We anticipate that the August and September existing sales data will reflect today’s pending sales report.

Treasury Announces Further Steps Toward Housing Finance Reform

On Aug. 17, the Treasury Department announced significant changes to an agreement with the Federal Housing Finance Agency dealing with the conservatorship of Fannie Mae and Freddie Mac. Under this agreement, Fannie and Freddie were required to pay a 10% annual dividend to the government on funds they have borrowed from Treasury. The revised terms eliminate the 10% dividend charge and instead require Fannie and Freddie to transfer future profits to Treasury until their outstanding government obligations are extinguished. This change means that Fannie and Freddie will not add to their outstanding debt to Treasury (and possibly hit their debt ceiling) in paying government dividends. It also establishes a means for them to eventually extinguish this debt. Treasury also changed the rate at which Fannie and Freddie are required to wind down their portfolios, from 10% to now 15% per year. These changes are further steps toward broader reform of the housing finance system, which is currently stalled in Congress.

GOP Draft Platform Includes Mortgage Interest Deduction
In an action that helps cement much-needed political support for a tax break that primarily benefits middle-income families, the GOP Platform Drafting Committee this week recognized the importance of the mortgage interest deduction (MID) by including it in the party’s draft platform. This welcome move followed a preliminary vote that, as reported by various news outlets, initially resulted in the MID being omitted from the platform language — but proved not to be the end of the story. Reacting to the good news this week, NAHB CEO Jerry Howard said, “We are very pleased that the committee has recognized the crucial importance of the mortgage interest deduction. Middle-class voters have seen their household wealth decline throughout the recession, and to a large extent, they are the ones who will decide the outcome of this election. They are also the prime beneficiaries of the mortgage interest deduction, so it seems obvious that maintaining this cornerstone of American housing policy should be among lawmakers’ primary goals.” Special thanks goes to Past NAHB President Shirley Wiseman for her efforts in achieving this good result.

Choose From More Than 400 House Designs and House Plans We offer house designs in a wide range of styles and sizes. Some of our more popular house designs include European-inspired Georgian and Palladian homes, English Manor house plans, Tuscan-style Italian villas, French chateaux, and Colonial house plans. Our Tuscan-style villas range from 1800 sf to 13,600 sf. Our Newport Classics house designs are gentrified New England-style cottages that range from 1500 to 5000 square feet. Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world. Please feel free to search our house designs or browse our photo gallery to get a sense of the many styles and types of house designs we offer. Our plans have been built around the globe, from Canada to Dubai, and one plan could be just for you!

Top Builder Confidence at Highest Level in Five Years

Builder confidence in the market for newly built, single-family homes improved for a fourth consecutive month and reached its best level in more than five years this August, according to the latest NAHB/Wells Fargo Housing Market Index. The index registered a two-point gain to 37 this month following a six-point increase in July, and currently stands at its highest level since February of 2007.

This good news was bolstered by the fact that each of the HMI’s component measures posted gains for the month, including three-point increases in the components gauging current sales conditions and traffic of prospective buyers, to 39 and 31, respectively, and a one-point gain in the component gauging sales expectations in the next six months, to 44. Likewise, each component was at its highest level in more than five years. Looking at the regional HMI scores, NAHB has just begun offering three-month moving averages for each area of the country in order to better represent emerging trends. Current three-month moving averages show a two-point HMI decline to 29 in the Northeast, a five-point gain to 35 in the Midwest, a three-point gain to 32 in the South and a three-point gain to 38 in the West.

55+ Housing Market Index

In similar findings, NAHB’s builder confidence gauge that looks specifically at the 55+ housing market also shows that builder sentiment is improving. The NAHB 55+ Housing Market Index, which is reported on a quarterly basis and uses year-over-year comparisons because the data is not seasonally adjusted, more than doubled between the second quarter of 2011 and the second quarter of 2012 to land at 29 for its latest reading just last week. While still depressed on a scale of 0-100, this marked the index’s highest second-quarter reading since it was created in 2008.

State Legislatures Express Support for Key Housing Incentives

In an important expression of support for housing, the National Conference of State Legislatures (NCSL) has approved new policy guidance that places a strong emphasis on key priorities such as the mortgage interest deduction and the Low Income Housing Tax Credit. Specifically, a newly revised NCSL policy document contains a section on “Responsible Housing and Housing Finance” that states the “NCSL is supportive of public private partnership programs and initiatives that increase the availability of financing for homeownership opportunities. NCSL supports first-time home buyer tax credits to promote homeownership prospects, preserving the mortgage interest deduction, and low-income housing tax credits that produce new, affordable housing.”

The fact that this newly approved policy received bipartisan support among the NCSL’s lawmaker members is particularly encouraging. “As state legislators we understand that Americans deeply value homeownership and for most people it is the largest investment they will ever undertake,” said Sen. Gary LeBeau (D-Conn.) and Rep. Anna Fairclough (R-Alaska) in a joint statement that echoed points NAHB has sought to emphasize in the current election season. The lawmakers also noted that “In order to grow our economy and provide increased stability, it is essential to preserve the mortgage interest deduction as it primarily benefits our middle-class taxpayers.” Applauding the NSCL’s new directive, NAHB Chairman Barry Rutenberg noted that “The idea of eliminating or curtailing the mortgage interest deduction has been suggested by policymakers at the state and federal level. That’s why it is so important that the NSCL has endorsed the mortgage interest deduction and other housing policies upon which millions of American families depend.”

Choose From More Than 400 House Designs and House Plans We offer house designs in a wide range of styles and sizes. Some of our more popular house designs include European-inspired Georgian and Palladian homes, English Manor house plans, Tuscan-style Italian villas, French chateaux, and Colonial house plans. Our Tuscan-style villas range from 1800 sf to 13,600 sf. Our Newport Classics house designs are gentrified New England-style cottages that range from 1500 to 5000 square feet. Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world. Please feel free to search our house designs or browse our photo gallery to get a sense of the many styles and types of house designs we offer. Our plans have been built around the globe, from Canada to Dubai, and one plan could be just for you!

Monday Morning Briefing


Home Builders Applaud Five-Year Reauthorization of Flood Insurance Program

In an important victory for the National Association of Home Builders (NAHB) and its members who rely on the National Flood Insurance Program (NFIP), Congress has reached an agreement to reauthorize the program through Sept. 30, 2017.

In the past few years, the NFIP has experienced several short-term lapses in authorization, forcing many home buyers to delay or cancel closings due to the inability to obtain NFIP insurance for a mortgage. In other instances, builders were forced to stop or delay construction on a new home due to the lack of flood insurance approval, resulting in unnecessary delays and job losses.

“NAHB has been working tirelessly to make sure that this vital program, which was set to expire on July 31, was reauthorized for five years to ensure that the federally-backed flood insurance program operates smoothly and without delay, remains efficient and effective in protecting property owners, and creates more stability in the housing market,” said NAHB Chairman Barry Rutenberg.

Congressional negotiators agreed to roll the flood insurance legislation into a larger legislative package that also includes the transportation reauthorization and student loan bill. The legislation was subsequently approved by the Senate and House and is expected to be signed into law shortly by President Obama.

Working with a bipartisan group of senators, NAHB was also successful in removing “residual risk” language from the flood insurance bill, which would have required the mandatory purchase of flood insurance for areas located behind dams or levees.

“NAHB believes the local investment in these flood control structures takes into account the risks, and to mandate the purchase of additional flood insurance policies at a cost to the home owner is simply unfair,” said Rutenberg. “We commend Sens. Mark Pryor (D-Ark.), John Hoeven (R-N.D.), Pat Toomey (R-Pa.), Richard Durbin (D-Ill.) and Bob Casey (D-Pa.) for their efforts in this area.”

In addition, Rutenberg thanked Sens. Thad Cochran (R-Miss.), David Vitter (R-La.), Tim Johnson (D-S.D.) and Richard Shelby (R-Ala.) for working towards a resolution to allow the flood insurance bill to move forward.

On the House side, NAHB commended the tireless efforts of Reps. Judy Biggert (R-Ill.), Maxine Waters (D-Calif.), Jerry Costello (D-Ill.), Bill Shuster (R-Pa.) and Spencer Bachus (R-Ala.) to push the bill across the finish line.

The five-year extension of the NFIP ensures that the program will remain available, affordable and financially healthy, said Rutenberg.

Established in 1968, the NFIP offers affordable flood insurance to home owners and businesses in flood plains and other low-lying areas that otherwise might not be able to obtain coverage.

More than 20,000 communities nationwide participate in the insurance program, which currently covers about 5.6 million policyholders.

Contrary to Internet Rumors, Health Care Tax to Have Little Impact on Principal Home Sellers

As the media centers on this week’s Supreme Court decision on the health care law, builders and the residential construction industry continue to wrestle with false rumors circulating the Internet that the new 3.8% Medicare tax on so-called unearned income set to take effect in 2013 is a straight tax on the sale of a home.

This is not the case.

The tax increase on capital income — such as capital gain and rents — will affect some real estate investments. However, it should have a negligible impact on sellers of principal residences.

The 3.8% Medicare tax will affect high-income taxpayers who report taxable income due to capital gains and other non-wage income. It will not affect income that is currently tax-exempt, including most capital gain due to the sale of a principal residence (due to the $250,000/$500,000 gain exclusion rules). Taxpayers with less than $250,000 in income will not see any increase in tax.

Circuit Upholds EPA’s Removal of the Opt-Out Provision The U.S. Court of Appeals for the District of Columbia Circuit on June 22 ruled that the Environmental Protection Agency had the authority to remove the “opt-out” provision from its lead paint renovation rule. While NAHB is disappointed with the court ruling, we continue to work with Congress to reinstate the opt-out provision. The opt-out provision would have allowed remodelers working in a home built prior to 1978 to forego more expensive work practices according to the owner’s wish if no children under the age of six or pregnant women resided there. NAHB led a coalition of industry groups to petition against the EPA, arguing that removal of the opt-out rule substantially increases the costs of complying with the lead paint rule without providing a corresponding benefit to the population that it is designed to protect – children under six and pregnant women. Two bills pending in the House and Senate (H.R. 5911 and S. 2148) would reinstate the opt-out provision.

In a positive development related to the lead paint issue, the House Appropriations Committee on June 27 approved an NAHB-supported amendment to the EPA’s spending bill offered by Rep. Denny Rehberg (R-Mont.) that would restrict funding for EPA enforcement activities related to its lead paint rule until the agency approves an appropriate “test kit” for ascertaining the presence of lead paint. The measure will next go before the full House.

Choose From More Than 400 House Designs and House Plans We offer house designs in a wide range of styles and sizes. Some of our more popular house designs include European-inspired Georgian and Palladian homes, English Manor house plans, Tuscan-style Italian villas, French chateaux, and Colonial house plans. Our Tuscan-style villas range from 1800 sf to 13,600 sf. Our Newport Classics house designs are gentrified New England-style cottages that range from 1500 to 5000 square feet. Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world. Please feel free to search our house designs or browse our photo gallery to get a sense of the many styles and types of house designs we offer. Our plans have been built around the globe, from Canada to Dubai, and one plan could be just for you!