NAR recently held its 2012 REALTOR Party Policy and Advocacy Conference in Washington, DC. The purpose was to give our members the opportunity to prioritize NAR’s policy agenda for the upcoming year. Our members listed their top public priorities for 2012 in five broad areas of serious concern: taxation, real estate finance, property insurance, appraisal and commercial issues.
During the conference we heard from many government and policy experts as well. To a person, they told us not to expect much legislative activity this coming year because our elected officials are focused on their own campaigns and the Presidential election. Once the election is over, however, we can expect a flurry of activity. In short, our best efforts over the next few months will be in tilling the soil on a number of critical real estate matters. We are going to be planting seeds in fallow ground over the next few months to reap a harvest of better housing and commercial real estate health later.
With Congress looking to expand the tax base to reduce the federal deficit, many of the exemptions that home ownership and real estate receive today could winnowed away. The tax issues that NAR will focus on are protecting the Mortgage Interest Deduction, extending Mortgage Debt Cancellation Relief for homeowners in trouble, preserving the capital gains exclusion on the sale of residences, and maintaining the property tax deduction for homeowners.
In real estate finance, the lack of available and affordable mortgage financing has been apparent for some time. Congress is considering a number of proposals aimed at creating healthier housing and mortgage markets. NAR priorities are the reform of Government Sponsored Enterprises credit policies and short sales. We believe that Fannie Mae and Freddie Mac should be restructured in a way that ensures consumers a reliable source of mortgage funding in all types of markets, under all types of economic conditions. With regard to credit, we believe the lending community needs to focus on providing more reasonable mortgage financing to qualified consumers. And on short sales, NAR continues to push for a faster, more efficient process that will help reduce the inventory of foreclosed homes.
In the area of property insurance, NAR continues to seek a re-authorization of the National Flood Insurance Program. NFIP has already been extended nine times in the last three years. A 5-year authorization would provide certainty and avoid further disruption of the real estate markets.
Appraisals are definitely on the minds of many REALTORS®. NAR strongly supports the independence of appraisers and the process and opposes the use of indemnification clauses by Appraisal Management Companies. Realtors throughout the country report serious problems with the current appraisal process.
Commercial Real Estate
Finally, the commercial real estate industry continues to face adverse conditions, with more than $1.2 million in commercial loans scheduled to come due in the next few years. NAR supports protecting and enhancing the flow of capital to commercial real estate. We believe that Congress should consider legislation aimed at improving commercial lending standards and practices.
While the year ahead is expected to see little legislative activity, when the issues that pertain to the health and vitality of the real estate market do finally break through today’s political ground, we’ll be ready. We are diligent caretakers of the ground that lies beneath all—NAR is and will be advocating policies that will result in a bountiful harvest for a recovering economy and an improving housing and commercial real estate industry.