Reps. Gary Miller and Carolyn McCarthy reintroduced a bipartisan bill that would enable state and federal banks to extend more credit to home builders in an effort to steady the recovery of the housing market. The Home Construction Lending Regulatory Improvement Act is identical to bills that died at the end of the 2011 and 2012 congressional sessions.
The bill would remove barriers to lending while preserving regulators' ability to assure the safety of the financial institutions they oversee, according to the authors. It hinges on making appraisals more realistic based on the market, eliminating the 100 percent of bank capital measurement, and prohibiting federal banking agencies from calling or curtailing a loan of a home builder in good standing.
The National Association of Home Builders reports that in many housing markets, demand is increasing, but builders are unable to obtain construction loans despite the record-low housing supply.
"As a result, jobs are being lost and home builders are unable to meet the needs of home buyers in scores of local markets whose economies are on the mend," said Rick Judson, chairman of the NAHB.
The NAHB said those in construction are not the only ones losing their jobs due to the current credit restrictions: schools, police and firefighters depend on property tax revenue to fund their services. Constructing 100 new homes creates more than 300 full-time jobs and $8.9 million in federal, state and local tax revenue, the NAHB says.
