NAHB rethinks strong stance on the mortgage interest tax deduction

The National Association of Home Builders changed its stance on one of the most highly debated homeownership conversations: the importance of the mortgage interest tax deduction.

“This is the first time in NAHB’s 75-year history that we have been open to the idea of broader options regarding housing tax incentives,” said Granger MacDonald, NAHB chairman and a builder and developer from Kerrville, Texas. “Now is the time to reform tax policy, and housing will not be left behind in this process.”

As one of the top lobbyists on Capitol Hill, for NAHB to put out an announcement on what it thinks about the MID is a big deal.

One of the only other housing groups that’s as vocal on the importance of the MID is the National Association of Realtors.

And to put in perspective exactly how much NAHB supported the MID, back in June, NAHB kicked off National Homeownership month by voicing its concerns over the House Republicans’ tax plan, which threatened the future of the MID. NAHB stressed that the mortgage interest deduction has been a cornerstone of American housing policy since the inception of the tax code.

Read the rest HERE.

Does the mortgage interest deduction help or hurt homeownership?

NAR and other experts fear that by raising the standard deduction, less people will itemize, and the mortgage interest deduction will have less value. This could, in turn, discourage homeownership, according to these experts.

“I think people buy homes because it represents security and a way to build wealth and a sense of stability,” said Laurie Goodman, Urban Institute co-director of the housing finance policy center. “I don’t think the mortgage interest deduction plays a large role in that decision.”

Dan Gilbert, Quicken Loans founder and chairman also agreed with Cohn, saying people buy homes because they are excited about the economy, not because of the mortgage interest deduction.

In fact, one expert says that while she would prefer to revise it, if she had to choose between keeping the deduction or getting rid of it, she would rid of the mortgage interest rate deduction.

“The mortgage interest rate deduction is not increasing the pipeline of working and middle-class homeowners,” Redfin Chief Economist Nela Richardson said in an interview with HousingWire. “It is a subsidy incentive that is given to people who itemize, and itemizes tend to be for high-income earners.”

A study the company expects to release latest this week shows households making over $100,000 receive 77% of the benefit from the mortgage interest deduction, while those making over $200,000 receive one third of the benefit.

Read the rest HERE. 

Report: San Diego needs to triple annual housing production

San Diego needs to roughly triple the number of homes it builds each year to keep up with demand and keep prices down, said a San Diego Housing Commission report released Thursday.

The commission, which is the city’s housing authority, produced the report with other government agencies to address rising rent and home costs. It said the city needs to take steps to increase the supply of homes — seen as the biggest reason for rising costs — such as eliminating required parking spots and increasing density in some areas.

The report argued the city would need an additional 150,000 to 220,000 housing units — that’s apartments, condos and single-family homes — by 2028, or 17,000 to 24,000 a year. It’s a tall order because the city’s top annual production rate in the last five years was 6,400 units.

“Whether you are working a minimum wage job or have a college degree and working a full-time job making a decent amount of money, you still can’t afford to rent or buy in San Diego,” said Councilman David Alvarez at a press conference Thursday at City Hall. “That is alarming.”

Read the rest HERE.

Equifax reveals data breach bigger than first thought

Equifax revealed Monday that the results of the forensic portion of its investigation into the data breach show that the breach actually exposed the personal information of 145.5 million consumers – 2.5 million more than the company first reported.

“I was advised Sunday that the analysis of the number of consumers potentially impacted by the cybersecurity incident has been completed, and I directed that the results be promptly released,” the company’s newly appointed interim CEO, Paulino do Rego Barros, Jr. said Monday. “Our priorities are transparency and improving support for consumers. I will continue to monitor our progress on a daily basis.”

Barros took over as the company’s CEO after Equifax’s previous CEO and chairman of the board, Richard Smith, abruptly announced his retirement last week in the fallout of the breach.

Read the rest HERE.

Walk away after a natural disaster?

Hurricanes Irma and Harvey came within a week of each other, and wrought havoc on parts of Florida and South Texas; thousands of homeowners saw their homes destroyed.

While the disaster story may be much the same for both hurricanes, the recoveries could be very different.

Black Knight released its latest Mortgage Monitor report Monday, showing the nearly opposite differences in the FEMA-declared disaster areas in both states, which could cause one city to quickly recover from the storm even as the other continues to struggle.

Before Hurricane Harvey hit South Texas, homeowners in the disaster area held an average combined loan-to-value ratio of 53%, or an average $131,000 in equity per borrower, according to Black Knight’s report. This is the same as the national average, and the lowest for the Houston area since before 2004.

Read the rest HERE.

Would you leave San Diego because of housing costs?

America’s Finest City is often called one of the most desirable places to live in the nation, but many residents think about moving away.

More than half of registered voters in San Diego and Orange counties have considered leaving California because of high housing costs, said a poll from U.C. Berkeley’s governmental studies school.

The poll interviewed 1,200 voters across the state and combined Orange and San Diego counties in one category. It released the data earlier this week.

It said 55 percent of voters in the San Diego and Orange region consider housing affordability extremely serious; 30 percent somewhat serious; 10 percent not serious; and 1 percent had no opinion.

Read the rest HERE.

Housing Overview: The Big Picture

Case Shiller contradiction: Home prices pick up speed despite fewer sales.

Home prices increased once again in July, and even began picking up speed, according to the latest index released from S&P Dow Jones and CoreLogic.

Nationally, home prices were up 5.9% annually to 194.1, yet another new high and an increase from June’s rise of 5.8%, according to the S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index, which covers all nine U.S. census divisions.

The 10-City Composite increased 5.2% annually, up from the annual increase of 4.9% the previous month, and the 20-City Composite increased 5.8% year-over-year, also up from July’s 5.6% annual increase.

Read the rest HERE.