WASHINGTON (Hanley-Wood News Service) - The nation's home builders strongly support the goal of ''broader homeownership, especially among minorities,'' expressed last night by President Bush in his State of the Union address. ''The President said last night that his economic security plan can be summed up in one word: jobs. One solution our industry is pursuing is the enactment of a homeownership tax credit. This would create new jobs to help lead the economy out of recession while simultaneously increasing the supply of affordable homes for sale,'' said Bruce Smith, a home builder from Walnut Creek, Calif. and president of the National Association of Home Builders (NAHB).
The program is designed to help bridge the gap between the cost of developing affordable housing and the price that buyers can afford to pay for a home in many lower-income neighborhoods.
Available through a competitive allocation program administered by state agencies, the homeownership tax credit would provide investors with a credit of up to 50 percent of project costs for eligible home rehabilitation or construction. Modeled on the Low-Income Housing Tax Credit, it is intended to encourage new construction and substantial rehabilitation of homes for sale to low- and moderate-income families in economically distressed areas.
''This initiative would help open the door to homeownership for thousands of families who now live at the edge of affordability. It is another step toward achieving the national goal of providing a decent and affordable home for every American,'' said Smith.
With President Bush declaring in his State of the Union address that ''we will defeat this recession,'' Smith added that the housing industry stands poised to lead the economy to higher ground in 2002.
''With the lowest mortgage interest rates in 30 years, a strong demand for new housing from the more than one million households being formed annually, and healthy gains in home values, the housing industry is in a unique position to lead the nation out of recession in 2002,'' said Smith.
A new report issued by NAHB, ''Housing - The Key to Economic Recovery,'' shows that housing accounts for about 14 percent of the nation's Gross Domestic Product, or about one out of every seven dollars spent in the U.S. each year.
The report shows that the construction of 1,000 single-family homes generates 2,448 jobs in construction and construction-related industries, and approximately $79.4 million in wages and more than $42.5 million in federal, state and local tax revenues and fees. Construction of 1,000 multifamily homes generates 1,030 jobs in construction and related industries, $33.5 million in wages and more than $17.8 million in federal, state and local tax revenues and fees.
''New housing construction and remodeling are powerful drivers of the nation's economic engine. The goals of the homeownership tax credit are to enable development to go forward, help revitalize economically distressed communities and increase the rate of homeownership in lower-income areas,'' said Smith.
Coalition members who support the homeownership tax credit include CEOs for Cities, the Coalition for Indian Housing and Development, The Enterprise Foundation, Fannie Mae, Freddie Mac, the Financial Services Roundtable, Habitat for Humanity International, the Housing Assistance Council, The Housing Partnership Network, the Local Initiatives Support Corporation, The McAuley Institute, the Mortgage Bankers Association of America, the National Association of Affordable Housing Lenders, the National Association of Counties, the National Association of Home Builders, the National Association of Local Housing Finance Agencies, the National Community Development Association, the National Council of State Housing Agencies, the National Association of Realtors, the National Cooperative Bank/NCB Development Corporation, the National Council of La Raza, the National Hispanic Housing Council, the National Housing Conference, Stand Up for Rural America, the U.S. Conference of Mayors, and United Way of America.