By any reckoning, 2003 was an extraordinary year for housing. Interest rates dropped to their lowest levels in almost a half century and remained comfortably low through the year. In response, new-home sales topped the million-unit mark--the highest level ever recorded--as housing remained a very strong force in the recovering economy. Late in the year, our industry recorded the highest monthly single-family starts rate ever--1.6 million units on an annual basis--setting the stage for another strong year in 2004.
Against this backdrop of strong housing performance our association scored some significant successes. The NAHB played a vital role in working with the Bush administration to enact the economic stimulus legislation, which trimmed billions of dollars off the nation's tax bill and preserved the value of the low-income housing tax credit. Equally important, it will help home building businesses save money and grow.
Attending the White House ceremony where President Bush signed this important legislation was one of the proudest moments in my life, and it's very satisfying to know that the NAHB's reasoned, collaborative approach contributed greatly to the enactment of legislation that has already had a significant impact on the economy.
Another important milestone occurred in mid-August when HUD granted Fannie Mae permanent program authority to purchase residential AD&C loans. The NAHB has been working for years to establish a secondary market for AD&C loans, and this was a significant step in that effort. Since then we have achieved a major breakthrough with the banking regulators, who are now seriously considering adding more detail on AD&C loans to the data they collect from banks, and we have continued to make significant progress on the many other aspects of this long-term effort.
Undoubtedly, the battle over the Government-Sponsored Enterprises (GSEs)--Fannie Mae and Freddie Mac--was our most pressing challenge in the past year.
In late summer, the Bush administration proposed shifting the program oversight for Fannie and Freddie from HUD to the Treasury Department. The NAHB was one of the first organizations to step forward and say no to that plan. While we certainly support having appropriate financial oversight of the housing GSEs, Treasury should not have oversight of new-program approval for Fannie and Freddie. Treasury has demonstrated a bias against housing and would shift capital away from the housing market, which is something that we just cannot allow.
Ultimately, Congress took no action on the GSEs in 2003, but key lawmakers in the House and Senate vowed to revisit the issue in 2004, and the NAHB continues to look at ways to ensure that Fannie and Freddie continue to provide crucial support to the housing market.
Serving as president of the NAHB during such a productive and exciting year was a great honor, and I'd like to thank everyone who helped make it such a positive experience: my family and the NAHB leadership, staff, and 211,000 grassroots members. Together, we are building the American Dream.