Executives Host Teleconference on State of the Housing Industry:
Swift Action from Congress is Needed
Executives from the National Association of Home Builders (NAHB)
hosted a conference call this week to discuss the dire state of
the housing market and what actions need to be taken to boost the
"This is the deepest and most rapid downswing since the great depression,"
said David Seiders, chief economist, for the National Association
of Home Builders (NAHB).
He pointed out that new home sales are down 65 percent from the
peak in 2005.
"New home sales will bottom out this year," he said. "Sales are
down 50 percent from peak to trough. That shows you just how steep
and sudden this has been."
Regarding mortgage rates he said the outlook is positive but added
that it will be more difficult for potential buyers to get loans.
"There is no question that housing is the weakest part of the economy
and pushing the economy toward a recession," he added.
Jerry Howard, NAHB chief executive officer, weighed in on what
initiatives Congress can take to help boost the housing market.
"It's incumbent upon policy makers to take action-actions they
could have taken several years ago, and if they had, perhaps we
wouldn't be in such trouble," Howard said. "We have to encourage
policymakers to take a hard look at the housing sector."
He mentioned a bill before Congress that would reform the Federal
Housing Administration and said this would be a good start. But
he expressed concern over what Congress hasn't done to help the
"I'm disappointed that the economic stimulus package that was passed
didn't include help for small businesses," he said. He added that
the government has not taken steps to address the overwhelming amount
Howard advocated a tax credit for first-time homebuyers that worked
during the 1975-1976 recession.
"A similar type of proposal now would make a difference in releasing
pent-up demand and diminish inventory," he said.
Declining house prices are also a huge concern. "This is a significant
issue for the economy," said Seiders. "It is absolutely essential
that home prices stabilize."
"Obviously we are quite concerned," said Howard. "Policymakers
need to act quickly."
HERE for the Seider's forecast slides.
HERE for information on NAHB's actions urging Congress to enact
temporary homebuyer tax credits.
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