The trend these days from politicians to preachers, from music gurus to realtors, is the bus tour. The National Association of Realtors has been tooling around the country on the “Home Ownership Matters Bus Tour”, discussing the impact that changes to the mortgage interest deduction could have on both existing and hopeful homeowners. This tour recently landed in one of the areas hardest hit by both the real estate crash, and the departure of jobs to greener pastures; Grand Rapids Michigan.
NAR President Ron Phipps told Marketwire that he believes home ownership “supports our nation’s economy and helps families build wealth.” Washington, however, doesn’t feel obliged to take notice that today’s market is very tough for many families, as lenders are hesitant to release their cash, even when the borrower is very well qualified otherwise.
One possible change - a reduction in FHA loan limits from 125 percent of the area median home price to 115 percent. In some cases, this change could result in a reduction of almost $74,000. These proposed changes could be disastrous for a state already hit hard by job security concerns. Employers are suspending hiring and in some cases reducing their staff while they wait - held hostage by Washington’s inability to listen to any other voices besides those who pay the most. This, in turn, results in individuals holding off their purchase of a home, thereby stalling economic recovery both in the region and across the country.
The goal of NAR’s bus tour is to make both existing and potential homeowners aware of the impact that changes to the MID could have on them. In 2010, nearly half of Michigan homeowners claimed on average about $10,000 in deductions, which is “no small potatoes,” especially to the average middle and lower income family, who benefit most from the MID.
“Home ownership is under attack,” said Phipps, “so it’s important for home owners and prospective buyers to get engaged on these issues, especially preserving the mortgage interest deduction, which is vital to the stability of the American housing market and economy. This bus tour is a great opportunity for the people of Michigan and others across the country to make their voices heard about the housing issues that matter most to them,” said Phipps.