In recent weeks this space has been filled with information canvassing a variety of housing issues. The concepts discussed have covered local, regional and international initiatives, specifically Canada.
On occasion, I've referenced a nationwide bank or philanthropic institution making news by creating a program or service that's beneficial to home ownership throughout the land. Beyond the turns and counterturns of the Federal Reserve Board and its seer and soothsayer, Alan Greenspan, few words have been allocated to the federal government, and for good reason -- there's not been anything newsworthy for comment until now.
The Community Homeownership Tax Credit first announced during President Bush's presidential campaign has been included in the White House's 2003 budget proposal. Modeled after the low income housing tax credit, the intent of this proposal is to provide incentives to bridge the gap between the cost of developing affordable housing in low-income neighborhoods and the price for which the houses are sold.
A credit of up to 50 percent of the project's cost would be provided to investors in specified neighborhoods for rehabilitation or construction. Using a competitive allocation system administered by state agencies, the program is intended for low- to moderate-income families in areas that are economically distressed.
There are two keys here. The first is the expansion of homeownership opportunities outside of the mortgage arena and into an area that effects us all -- taxes. This, in my humble opinion, is one of the better ways to stimulate new home purchases.
The second is the broad coalition of community development housing groups from across the nation that coalesced in support of this proposal. Under the name of the Community Homeownership Credit Coalition, 26 housing organizations came together to encourage enactment of the credit -- including the U.S. Conference of Mayors, the National Hispanic Housing Council and the National Community Development Association.
Considering the breath and scope of the groups involved in support of a new government initiative, that in and of itself is a remarkable achievement.
But what's more important is the expected impact on low- and moderate-income families hoping to fulfill the homeownership dream. According to the proposal estimates, the incentive would stimulate $5 billion for construction and rehabilitation of 40,000 to 50,000 homes a year in areas that need all the incentives they can get to prevent their erosion.
It's a simple initiative that shoots straight from the hip right through the meaty center of our super-sized government bureaucracy to the soft underbelly where many of us reside. It lightens the load of feudal patronage for those who rarely benefit from an economic incentive and need it most -- those who want to take the next step up the homeownership ladder.
Any individual tax credit is a good tax credit. So lets give credit where credit is due -- to this 2003 budget proposal, which would expand the potential for homeownership to many who are in the middle of the pack.
STEVEN J. LOWENSTEIN, a native of Cincinnati, is a Realtor with Coletta & Associates Realtors. He's a graduate of the University of Cincinnati and holds a Master's degree from North Texas State University.
