Author Archives

  • Remodeling Market Index Edges Up: Big Projects & Calls for Bids Close to Break Even

    NAHB’s Remodeling Market Index (RMI) edged up from 40.8 to 41.5 in the fourth quarter of 2010. RMI numbers below the “break-even” point of 50 mean that a preponderance of remodelers are telling us that things have slowed down since the previous quarter. In a declining market, we look for the RMI to get back up to 50 as an… Read More ›

  • State of the Union: Focus on Corporate Tax Reform

    President Obama identified a number of economic policy priorities in this week’s State of the Union Address. The speech presented a general theme of improving U.S. economic competiveness. The following observations highlight those portions of the address that pertain to the housing industry, as well as explain the difficulties in achieving revenue neutral corporate tax reform. The president endorsed the… Read More ›

  • Tax Reform Debate: Multifamily Focus

    The year 2011 will almost certainly witness a debate about the future of government spending and tax revenues. During the latter half of 2010, numerous groups, including the president’s deficit commission (the National Commission on Fiscal Responsibility and Reform), presented plans that included proposed overhauls of the nation’s tax code. While the mortgage interest deduction and employer-provided health insurance exclusion… Read More ›

  • 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 ›