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FOR RELEASE JANUARY 31, 2007
For more information contact Bruce Hahn, 571-214-1013
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Homeowners Call on Congress to Encourage Home Ownership
Comprehensive changes in tax and other laws will reinforce
the trend towards home-centric lifestyles and will benefit the
middle class
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Washington DC, January 31,
2007. The American Homeowners Grassroots Alliance (AHGA) today called on
the House Ways and Means Committee to make changes in tax and other laws
that will accelerate the trend towards home-centric lifestyles that are
benefiting homeowners and the economy. The Committee, which has
oversight of federal tax, healthcare and other laws, was holding a
hearing on challenges facing middle class families.
The American home is becoming more important to our society, AHGA told
the panel. Increasingly homes are playing the much broader role they
provided our forefathers. At its founding ours was an agrarian nation,
and the workplace of homeowners was on their own property. Health care
was provided by doctors at the patient’s home and nursing was provided
by the patient’s family in the home. Most elder care was provided in the
home by family members.
In many ways American homeowners are returning to this home-centric
lifestyle, according to AHGA. The number of home-based businesses is
growing rapidly – some 10 million individuals earn a part time or full
time living as eBay sellers. Teleworking is also rapidly growing in
popularity as more employers, including the federal government, are
facilitating the ability of employees to work from their homes either
part or full time.
The trend towards a home-centric lifestyle is increasingly reflected in
new home design and remodeling. More new homes are being built and
existing homes remodeled with two home offices as well as floor plans
and features that enable seniors with mobility challenges to age in
place in their own home, rather than being forced to move to health care
facilities. New wearable wireless medical monitoring devices now under
development will also allow many of the nation’s 7 million chronically
ill and many seniors with medical challenges to remain in their homes
while their health can be monitored remotely 24/7 via computer modems.
These are important trends from many perspectives. Not only do they
improve the quality of life and allow homeowners to better connect to
their community, they also have other tangible benefits. A person who
works from home does not need to commute to another workplace, which
reduces demand for gasoline and global warming. By reducing the number
of commuters, rush hour traffic jams and traffic slowdowns will also be
lessened, thereby also reducing the gasoline consumption and air
pollution from the vehicles of those who continue to commute to work.
Federal and state government health care subsidies and private insurer
medical costs will also be reduced by homeowners who will be able to
remain in their own homes rather than forced to move to long term care
facilities, hospitals, or other medical facilities.
AHGA thanked the House Ways and Means Committee for steps it has already
taken that both facilitate home based businesses and teleworkers and the
reduction of home energy consumption. Recently enacted tax credits that
encourage home energy efficiency and the construction of energy
efficient new homes are helping the environment and saving homeowners
money. The deductibility of private mortgage insurance will help more
low and moderate income homeowners to afford to buy a home. AHGA urged
the committee to permanently extend these current laws, all of which
sunset in 2007 or 2008.
Other legislation already under consideration in this new Congress will
also help most homeowners. AHGA also supports the Ways and Means
Committee’s commitment to adjust and index the alternative minimum tax
to exempt middle class homeowners. And the budget prudence reflected in
Congressional “paygo” rules is also appreciated by American homeowners,
who typically have no other choice but to pay as they go for everything
else with the money left over after their monthly mortgage payment. The
amount left over is often insufficient to cover other substantial costs
facing most homeowners, such as healthcare and college education for the
homeowners’ children. In that regard AHGA thanked the committee for its
support for reducing the cost of prescription drugs and expanding
student loan programs.
More needs to be done according to AHGA. The appreciation of homes in
recent years has placed home ownership out of the reach of growing
numbers of our citizens. We need to do more to get those at the lower
end of the economic scale on the road to home ownership sooner. To
expand home ownership AHGA recommended that first time home buyers be
allowed a tax credit of 10% of the home’s price, capped at $6,000. An
affordable housing tax credit should also be enacted to create more
homes for low income taxpayers and a national housing trust fund should
be established to build rental housing for the lowest income families.
AHGA also urged the committee to consider other steps to foster home
ownership and/or increase savings, such as modifying ERISA to permit
investments by retirement plans in principal residences of children and
grandchildren who are buying their first home, increasing IRA, 401K and
other retirement savings plan contribution limits, and taxing annuity
payments at the same rate as dividends.
Additional steps are needed to encourage the healthy migration back to a
home-centric lifestyle. Health insurance is very expensive and is rising
rapidly. AHGA urged the committee to consider tax incentives to make
health insurance less expensive for home based businesses and other
homeowners who lack employer sponsored health care plans. Homeowners
and/or their employers should be encouraged through additional tax
incentives to invest in the technology used for the purpose of
telecommuting. Telecommunications technology is also critical to
teleworking and home based businesses. It is also a powerful research
tool for students and a critical element for the implementation of
future home-friendly medical technologies. AHGA asked the committee to
consider tax incentives that will facilitate faster and wider deployment
of the ultra high speed broadband required to support many these
applications, particularly in deploying broadband access to more rural
communities and to the economically disadvantaged.
There are other important issues affecting homeowners and home ownership
outside the scope of the Ways and Means Committee’s oversight, and AHGA
hopes that committee members will support legislation in those areas as
well. There is a need for Congress to step in to address serious
barriers to competition and other problems in the real estate services
sector, including real estate brokerage services, mortgage lending, and
title and other insurance. There is a need to improve the protection of
consumer privacy, particularly as it relates to technology, and to
assure that homeowners and other consumers can fully benefit from
technology’s increasingly important role in facilitating our nation’s
return to a home-centric society. A greater commitment to energy
research and tax incentives for clean energy will also benefit future
generations of homeowners.
The American Homeowners Grassroots Alliance is a nonprofit consumer
advocacy organization dedicated to assisting homeowners better
understand the significant economic issues affecting their home and
their lifestyle, and empowering them to make their voices heard by state
and federal officials.
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