Author Archives

  • Who Benefits from the Housing Tax Incentives?

    Recent research conducted by economists at NAHB details who benefits from the major housing tax rules, including the mortgage interest and real estate tax deductions. The findings in the paper illustrate the following points: 68% of the benefit of the mortgage interest deduction (MID) is collected by homeowners with less than $200,000 of economic income (77% for the real estate… Read More ›

  • A Look Ahead: 2011 Housing Policy Issues

    The end of 2010 generated important housing policy-related news. The tax cut extension legislation was signed into law and the Federal Reserve  continued to expand its holdings of government securities and maintained a federal funds rate ranging from 0 to ¼ of percent. As we begin the new year, now is a good time to consider those events and issues… Read More ›

  • New Research Details Structure of the Home Building Sector

    NAHB Director of Economic Services Steve Melman has published a paper that details the structure of the residential construction sector. Using 2007 Economic Census and other data, Melman’s analysis reveals a dynamic sector dominated by small firms.  His findings include: 65% of all home building establishments had annual receipts under $1 million in 2007. Another 31% had receipts between $1 million and $10 million. Only 4%… Read More ›

  • Update: Senate Passes Bill with Expiring Housing Tax Provisions

    Today the Senate voted 81-19 to approve H.R. 4853, the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010. The legislation now moves to the House of Representatives, with a vote expected December 16, 2010.  (Updated 12.17.10 – The House of Representatives has approved H.R. 4853 by a vote of 277-148.  The legislation will be signed into law by the… Read More ›

  • Household Balance Sheet Repair Continues

    We’ve been tracking data from the Federal Reserve’s Flow of Funds and the Bureau of Economic Analysis to get a sense of how quickly households are paying down debts. One of the factors preventing a robust economic recovery is deleveraging, as households and businesses pay down debts and restore net worth to long-run norms.  A consequence of deleveraging is an elevated personal savings rate,… Read More ›

  • How Would a 12% Mortgage Interest Credit Work

    After we examined the final deficit commission report, some readers have asked us to compare how the proposed 12% mortgage interest tax credit would work relative to the present-law itemized deduction for mortgage interest. It is first important to keep in mind that the commission report is just a proposal, so the following contrast is hypothetical. Under present law, in… Read More ›

  • Expiring Housing Tax Provisions under Debate in Congress

    As the debate concerning the extension of the major 2001 and 2003 tax cuts comes to a close (at least for 2010), it is worth taking a look at those housing-related tax rules that have or will expire with the end of 2010.  The congressional debate is primarily concentrated on larger rules like the top marginal rate (will it increase… Read More ›

  • Deficit Commission Presents Final Report: Impact on Housing

    The president’s National Commission on Fiscal Responsibility and Reform has issued a final draft – entitled The Moment of Truth –  of its tax, spending and entitlement policy proposals with the aim of reducing the federal government’s long-term structural budget deficit. The final report incorporates elements from the commission’s initial co-chairs’ proposal and the subsequently issued Domenici-Rivlin plan. The commission… Read More ›

  • Federal Reserve Reports Economy Continues to (Slowly) Improve

    The Federal Reserve’s December Beige Book, which surveys national economic conditions, reports that for the October to mid-November period economic activity continued to grow, albeit at a slow pace.  The report indicates that manufacturing activity increased, with strong growth for auto and metal fabrication. Professional and non-financial services also continued to show steady growth. With respect to housing, the December Beige Book noted that housing markets continue… Read More ›

  • Comparing Deficit Proposals: Impact on Housing

    In the last two weeks, we have seen two comprehensive proposals to address the federal government’s long-term budget deficit. We previously discussed in detail the co-chairs’ draft proposal from the President’s National Commission on Fiscal Responsibility and Reform. This week, a separate group, the Debt Reduction Task Force, which is a project of the Bipartisan Policy Center, presented another proposal… Read More ›