For many families the home is the center of their family unit.
For countless others, it represents stability; the generation
of wealth; the achievement of a dream.
Delegates to this year’s Democratic and Republican national
conventions and all candidates for political office need to know
about the enormous impact of the housing market. To that end,
National Association of Home Builders President Bobby Rayburn
has crafted this Top 10 list to underscore the affect and value
of housing to our nation.
10. Housing is leading the nation’s economic recovery.
Home builders constructed more than 1.8 million new homes and
apartment units in 2003, and a record 1.1 million new homes were
sold last year. Production and sales are expected to exceed those
figures in 2004. To sustain this level of production, a healthy
overall economy with low interest rates and rising real incomes
is absolutely critical. In 2003, housing activity accounted for
16 cents of every dollar spent in the U.S. economy.
9. Housing creates good-paying jobs. The 215,000 members of
NAHB employ about eight million Americans, making the housing
industry one of the nation’s largest employers.
8. Housing generates wealth. Housing accounts for 32 percent
of household wealth in the nation. Homeowners have a total of
about $8 trillion in home equity, which is often used as a nest
egg for retirement or to cover college expenses.
7. A major housing gap. While the national homeownership rate
stands at a record 68 percent, millions of working families are
still struggling to obtain decent shelter. The homeownership
rate for minorities lags 25 points below white households. In
addition, more than 14 million still spend more than 50 percent
of their income on housing or live in seriously substandard housing.
6. The job of housing America is far from complete. Home builders
will have to construct 18 million new home and apartment units
over the next decade just to keep up with rising population and
household growth. Financing this housing will require $3 trillion
annually in new mortgage loan originations. Such a growth rate
will require strong primary and secondary mortgage markets and
an ongoing commitment by the federal government to support the
housing finance sector.
5. Growing need for affordable housing for America’s workers.
As the number of immigrant, minority and female-headed households
continues to grow over the next decade, demand for starter homes
and affordable rental housing will increase. Unfortunately, more
and more working families, including teachers, firefighters,
nurses, police officers and other public servants, are being
priced out of the local markets where they work and they are
commuting two hours or more each day to work.
4. Smart growth. New household formations are expected to average
between 1.3 and 1.6 million per year during the next decade.
To satisfy this robust housing demand, local and state governments
need to enact sound land use policies and reform and streamline
the zoning and regulatory process. Sensible growth management
policies will meet a community’s housing needs and allow
for construction of a mix of different types of housing in various
price ranges. At the federal level, policy makers need to establish
a more balanced environmental agenda that supports the twin goals
of providing for a clean and healthy environment and meeting
the nation’s housing needs.
3. Credit is the lifeblood of the housing market. Maintaining
an adequate flow of credit is fundamentally important. During
the next decade, America’s families will need 125 million
mortgage loans, or an average of $3 trillion annually, for home
purchases and refinancings. Therefore, policy makers must guard
against any backdoor attempts to alter the regulations affecting
the housing government sponsored enterprises in a way that impedes
the ability of Fannie Mae, Freddie Mac and the Federal Home Loan
banks to provide lenders with new mortgage products and ensure
an affordable and steady flow of credit for home mortgages.
2. Meeting the housing needs of the underserved. The federal
government should also support special programs and tax incentives
that promote homeownership or help low- and moderate-income families
buy or rent decent housing. Housing initiatives in Congress that
enjoy broad bipartisan support, such as the homeownership tax
credit legislation, the FHA zero downpayment program and improvements
in the Low Income Housing Tax Credit, need to be enacted into
law.
1. Elevate housing as a national priority. Housing, like other
basic human needs, should be a top national priority. By reaffirming
this commitment to housing, the next Congress and Administration
can help fulfill the promise of the Housing Act of 1949, which
set a goal of "a decent home and a suitable living environment
for every American family."
For more information about the National Association of Home
Builders, visit www.NAHB.org.
(Mac McKinney, who is owner and president of McKinney Builders
Inc., is president of the Home Builders Association of Midwest
Georgia, which serves a membership of approximately 550 builders
and associate members in Fayette, Coweta, Spalding, Meriwether,
Heard, Pike, Upson, Lamar, Butts and Jasper counties.)
