Housing Stimulus Package Under President's Review

Both the U.S. House of Representatives and Senate passed a housing stimulus package last week designed to booster the economy. The bill, H.R. 3221, now awaits President Bush's approval and signature, which is expected.

Once signed, the bill will provide for a temporary, $7,500 first-time homebuyer tax credit for the purchase of any home, purchased between April 9, 2008, and July 1, 2009.

"With the U.S. financial system now under extreme duress, H.R. 3221 represents a thoughtful, comprehensive approach to address the housing and economic crisis facing the nation," says National Association of Home Builders (NAHB) president Sandy Dunn, a home builder from Point Pleasant, W.Va. "This bill is vital to restore confidence and get housing and the economy moving again."

In addition to the first-time home buyer tax credit, the bill would allow the Department of Treasury to purchase an equity stake in Fannie Mae and Freddie Mac, and would give the Federal Reserve a supervisory role over the two government-sponsored enterprises (GSEs).

H.R. 3221 also would:

Modernize the Federal Housing Authority and permanently raise its loan limits;
Give states authority to issue an additional $11 billion in mortgage revenue bonds;
Reform the regulation of the GSEs and permanently increase the conforming loan limit to help buyers in high-cost markets;
Enhance the Low Income Housing Tax Credit;
Provide foreclosure relief; and
Provide tax relief for home owners who don't itemize their deductions.

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