Sen. Johnny Isakson (R-Ga.) has been fighting for a substantive home buyer tax credit for more than a year. Twice now, his proposals have been approved by the Senate, only to be eliminated or diluted in the final versions signed into law. “It’s something we absolutely need to address. … This is talking about using tax policy and the full faith and credit of the United States to get people into the housing market. … I’m not going to stop trying to get that.”
He believes in tax credits to revitalize housing because he’s seen it work before. Isakson was managing a real estate brokerage in the Atlanta market in 1974, when a $2,000 tax credit jump-started a severely depressed market. “In one year’s time, a three-year supply dissipated,” he says. “There’s no question the tax credit worked. It will work again.”
Q: What do you believe are the most critical steps Congress needs to take to revitalize the economy and put Americans back to work?
A:There’s an appropriate role for government to stimulate the economy, and that’s with tax policy. … There are a lot of tax policies that make sense. The best way to create jobs is to incentivize people who hire people. … Right now, though, given the depths that people are in, I think we also need to look at expanding food stamps and unemployment insurance to stabilize them.
Q: Do you support the reinstatement of seller-funded, down-payment assis- tance? Why or why not?
A:Down-payment assistance (DPA) is really important in entry-level housing, but we have to be very careful with it. When we passed the housing bill last July, I tried to put a one-year extension on DPA to give us time to write the parameters. Congress didn’t see clear to do that. When [Treasury] Secretary [Timothy] Geithner comes forward with his recommendations, hopefully we can reestablish that with the proper controls.
Q: Builder recently asked Nicolas Retsinas, director of Harvard’s Joint Center for Housing Studies, if we need to rethink the concept of homeownership as the American dream. What do you think?
A:If you turn your back on homeownership, you need to recognize what you’re doing to the underpinnings of the economy. The current crisis doesn’t mean housing is a bad idea. It means shoddy underwriting and loose credit was a bad idea.
Learn more about markets featured in this article: Atlanta, GA.