The National Association of REALTORS® created its Housing Stimulus Plan to urge Congress to include provisions to the recent economic stimulus bill that will help stabilize the nation’s housing markets. The plan includes four points that focus on buyer incentives:

1. Remove the requirement in the current law that first-time homebuyers repay the $7,500 tax credit, and expand the tax credit to apply not only to first-time buyers but also to all buyers of a primary residence.

2. Revise the FHA, Fannie Mae, and Freddie Mac 2008 stimulus loan limit increases to make them permanent. The Economic Stabilization Act, enacted in February, made loan limit increases temporary, and subsequent legislation reduced the loan limits and made them permanent. This has broad implication for homebuyers in high-cost areas.

3. Urge the government to use a portion of the allotted $700 billion that was provided to purchase mortgage-backed securities from banks to provide price stabilization for housing. The Treasury department should be required to use the newly enacted Troubled Assets Relief Program to push banks to:

• Extend credit down to Main Street, making credit more available to consumers and small businesses

• Expedite the process for short sales

• Expedite the resolution of banks’ real estate owned (REOs) properties

4. Make permanent the prohibition against banks entering real estate brokerage and management, further protecting consumers and the economy.

In line with NAR’s plan, the Federal Reserve announced plans to purchase mortgage-backed securities from Fannie Mae, Freddie Mac, and Ginnie Mae for up to $500 billion. NAR President Charles McMillan said, “This is great news for home buyers and sellers and we applaud the Fed for taking this historic step.”

The plan is not without controversy, though.  Some feel it does little to assist those facing foreclosure, and it suggests using tax-payer money to bailout irresponsible lenders.  What do you think?

This entry was posted on Monday, December 1st, 2008 at 2:21 pm and is filed under Real Estate Market. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.