RISMEDIA, June 11, 2009-The Housing Working Group of Business Roundtable, an association of chief executive officers of leading U.S. corporations, announced bipartisan proposals to help return stability and growth to the U.S. housing market.
“We recognize the earlier efforts made by the Administration and Congress, but strongly recommend taking additional steps to jumpstart the lagging housing market in order to stimulate a broader economic recovery,” said Richard A. Smith, president and CEO of Realogy Corporation and Chair of Business Roundtable’s Housing Working Group.
“If the housing market is not corrected or stabilized, the tide of the recession is not likely to reverse in the near term, and the slide in the economy overall will continue. We believe targeted, demand-side solutions-such as the ones Business Roundtable is recommending today-will provide a critical next step for a housing recovery that will help create jobs and boost the economy as a whole.”
The recommendations include expanding home buyer tax credit incentives from $8,000 to $15,000 while expanding eligibility from strictly first-time home buyers to all home buyers, regardless of income, on homes purchased as a primary residence. Among other recommendations, the CEOs also strongly encourage the Administration to continue ongoing efforts by the Federal Reserve to keep 30-year fixed mortgage interest rates at historically low levels and do so for the next 12 months, and to undertake a comprehensive review of existing foreclosure mitigation and loan-modification programs.
Business Roundtable’s Housing Working Group was formed on April 1 to provide actionable recommendations to Congress and the Administration on how to stabilize and grow the U.S. housing market. Recent reports indicate that without significant and immediate reform the U.S. housing market will continue its decline, further dragging down the economy.
“The Obama Administration’s extraordinary efforts to lower interest rates, along with its passage of the stimulus package, were both essential first steps toward stabilizing financial markets and promoting U.S. economic confidence,” said John Castellani, president of Business Roundtable. “Congress and the Administration must now build on these gains by stimulating demand for housing, which will create new jobs and trigger expansive economic recovery for America’s citizens, communities and companies.”
The group strongly believes adoption of its proposals will have a cascade effect, creating jobs and hastening U.S. economic recovery. The group’s recommendations are to:
1. Keep mortgage interest rates at historically low levels (below 5%) for at least one year;
2. Expand the current First-Time Home Buyer Tax Credit incentive from the lesser of 10% of the purchase price of the home or $8,000 to a higher limit of either 10% or $15,000 for all home buyers, remove the income restrictions and include all primary residence purchases for one full year;
3. Conduct a thorough review of current foreclosure mitigation and loan-modification programs in light of rising loan-modification re-default rates;
4. Make permanent the current temporary conforming loan limits; and
5. Continue to review and strengthen government efforts already underway to review and refine mortgage lending practices.
In addition to Richard A. Smith and John J. Castellani, the Housing Working Group consists of: Thomas C. Nelson, Chairman, President and CEO of National Gypsum Company; Steve Odland, Chairman and CEO of Office Depot; Daniel S. Fulton, CEO of Weyerhaeuser Company; Jeff M. Fettig, Chairman and CEO of Whirlpool Corporation; Michael H. Thaman, Chairman and CEO of Owens Corning; and Roger Fradin, President and CEO of Honeywell Automation and Control Systems.
More information about the Housing Working Group can be found at www.businessroundtable.org.