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Market Insights

JOHN RICE REPORTS FROM WASHINGTON, DC

NAR Mid-Year Meetings, Washington, DC, May 13-17

By John Rice, President, Seacoast Board of REALTORS

 

 Vice President Lori Breard-Weeden and I attended the meetings, flying in on the morning of the 14th and coming back on the evening of the 16th.

 

This year the NAR brings  a very clear agenda  before Congress.  On the list is housing stimulus legislation, and, basically, the old "chestnuts" --improving access to affordable insurance and small business health care legislation.

 

Under housing stimulus, the NAR seeks FHA and GSE reform, making the recently increased loan limits permanent. It also wants a Homebuyer Tax Credit for any property purchased as a principal residence. The tax credit is probably the most important item on the REALTOR agenda.

 

In the insurance arena, the NAR wants to reauthorize the Flood Insurance Program before it expires September 30. It also wants legislation that enhances the availability and affordability of homeowner's insurance. Making health insurance widely available and affordable for self-employed individuals and owners of small business is  very high on the NAR's list. That's the agenda we took to the Hill.

 

Wednesday May 14 about 30 of us visited Congresswoman Carol Shea-Porter and Senator John Sununu.  After speaking with Shea-Porter's Legislative Assistant, Chris Hillesheim, we finally met the Congresswoman in a hall way as she rushed between meetings. She assured us that she was on board with every one of the NAR initiatives and emphasized that-especially with healthcare-she's for anything that can move the debate along.

 

Sununu met with us in his briefing room. He indicated that he backed our agenda or would at least "look at all aspects of it." He was not for expanding FHA loan limits since he felt that that organization needed to get its own financial house in order first and the new limits seem to already meet the needs of lower income buyers. Sununu, by the way, sponsored a bill that included the Homebuyer Tax Credit.

 

Thursday morning we met with Paul Hodes. Hodes said that "things are starting to happen" in healthcare reform, but it will take a change in presidents to make it law.  He is sponsoring a bill to create "green mortgages" for those who build green. "This should be interesting to REALTORs," he said. "And it won't burden the federal treasury. We should be leading the world in energy efficiency."

 

Senator Gregg was unable to meet with us, so we discussed the NAR agenda with one of his senior staffers. Being chair of the Finance Committee, Gregg's positions seems more conservative than the others, as he must make the numbers fit the president's budget.  

 

Earlier in the morning, I heard NAR Chief Economist Lawrence Yun. Yun said that the market is stabilizing at 1998 sales levels. He sees the "head winds" subsiding since FHA loan limits are rising and Jumbo loan rates have fallen one point. But the deliquincy  rate in sub prime  mortgages is expected to rise through the end of the year, causing price declines in neighborhoods where exposure to sub prime is factor.

 

Yun thinks the Homebuyer Tax credit now pending before congress could be a huge factor in getting the "fence sitters" to finally buy.

 

For the second half of 2008, Yun sees notably higher sales as the economy improves. The data suggests we are not in a recession and that buyers are already starting to come back. We face a slow recovery in 2009, but prices in the greater Boston area should not fall as drastically as other regions of the country.

 

This was my third consecutive spring visit to Washington, D.C.  Lori and I thank you for the honor of representing the Seacoast Board in our nation's capitol.

 

 

 


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